No, it's just wrong. Don't care how impossible it would be to get people to answer these things truthfully... Don't care if it's one way to do the social engineering to make this kind of thing work. The results he put together were the wrong ones. The right ones would have been little notifications that say "You have a mutual public crush with 2 people, and mutual secret crushes with 3. Pay $4 to automatically inform both you and your mutual crushes." If people answered the quiz without worrying about this other kind of evil being perpetrated... it might have been a useful service.
On the other hand, it would be possible to put together that service wholly in the open... Though then, some people, knowing the schtick, would put crushes on all the people they thought might conceivably crush on them, and then sit back and watch the fireworks. The thing that makes that service not work is people going "Oh, I just said I crushed on everyone."
All in all, it was a bad abuse of trust. The crush thing has ruined many types of quizzes for the future now, making people step back and say "hmm, how can this be abused?" And think about it, even image tags in an LJ can be used to track who's reading your lj, and from where...
Click here if you want to see me lying down in an orchard. I'll take a look at who looked at this image in my logs later on, though. :) It really is me in that pic, though. *shrug* Experiment number one.