Yup, its true. Some people actually make that much blogging. Check out this Business Week article on the top bloggers out there (click the images across the bottom to read each story and see how much each makes). Basically, none of them expected to be making that much money blogging. They either started the blog as an inside joke or to cover a tiny niche, which then exploded. With large volumes of traffic (some 100,000 unique hits a day!), they were able to start selling ad space.
I'm up to about 2,000 unique hits per month on this blog (10,790 hits so far this year), and I've actually made a couple of dollars with my AdSense ad's -- but I'm not looking to make money with this blog. I consider this my social outlet and public diary of events; a way to go back and find out when I began trying to sell my Audi or how I solved a particular problem. The discussion created by visitors posting comments is a nice way to exchange ideas and see the point of view of others.