From what I can tell, sponsored Ads (the 125x125 ones) are not connected to Google AdSense, and are not automated in any way.
I am wondering how other users have sold Sponsored Ads in the past. I want to limit the number of Sponsored Ads packages I sell, because there are limited Sponsored Ads positions. I also have to give instructions on how to send me the ad URL and image. How have you solved the problem?