Do some posting of your own! A common mistake people make is to start a forum adn expect conversations to start themselves.

Haha, great point! I know that feeling very well....

In terms of adverts i'm running the "web design library" ones for free simply because the adverts look nice and are relevent to the community. I have one paying advertiser right now (actually two but the other advertiser hasn't contacted me with their banner yet!) I post my offers on forums such as wht, sitepoint etc.

I would never use ppc/adsense etc, the adverts look ugly and don't bring in alot of revenue.

In terms of improving your forum, post more threads, bring in your friends to help you, add your link to your sig in every forum you post on! Perhaps consider starting a contest to kick start your community.