DoubleX concern trolls Etsy.
Most of the commenters to the article make the obvious point that Etsy, for a true capitalist, is one among many possible marketing channels. Etsy rules, although it's tough to find new stores sometimes. My Etsy custom tote bag that's being made right now was definitely more than the average item price of $14. I could have just replaced my cat-destroyed H&M bag with another, but I am patronizing a small business in upstate New York and getting something unique by using Etsy.
The real issue is not whether SAHMs are getting caught up in a fantasy; most acknowledge that crafting's not going to pay the mortgage. It's whether we support people with artistic urges by encouraging them to inject a little commerce into the mix. Say a seller barely breaks even, but gets to spend lots more time doing something creative she enjoys. That's not a bad scenario! She could be scrapbooking (which is a giant money pit and a time suck) or deadening her impulses with soap operas! Why bash a site that faciliates the production of art and trade that makes everyone better off? Bloggers monetize their hobby all the time and most blog commentary isn't worth a stitch marker. Lay off the random 30-somethings who enjoy making handbags and sell them for a little extra cash.
(Sometimes I wonder if we've come full circle, back to custom artisan goods, with the internet to enable cottage industry to reach a broad enough market to make it worthwhile. For things like clothes and accessories, has industrialization lost its advantages?)