I'm the interviewed Eva =)
And I did finish! I made it to 50180 or thereabouts. I was traveling during the deadline (which is why I was in London to be interviewed for the LabLit podcast in the first place) so it was hard, but I made it!
There are no "winners" in the sense of being judged by quality of the output, it's really only about reaching 50k words within a month, and you're deemed a "winner" if you reached that goal. The winners get some freebies, including a 50% discount on writing software and one free print of a print-your-own-book thing.
Judging the novels written would be dreadful. In 2008, more than 20,000 people made the 50,000 words goal, so that's a LOT of reading material.
Most people don't finish a proper finished product within 50,000 words, but there are some cases of people then editing and finishing what they started, and even getting it published. There's a list on the NaNoWriMo website, on the media page (which has a ton of info)
http://www.nanowrimo.org/eng/mediakit The most famous of the published NaNoWriMo products is probably "Water for Elephants" by Sara Gruen, which was a NYT bestseller a few years ago.
There's also a "Young Writers Program"
http://ywp.nanowrimo.org/ that encourages kids to participate. They can set their own word goal, and teachers can order some classroom goodies. Those novels aren't judged on merit either (unless the teachers are evil) but the program is something to get kids writing for fun.
My own crappy 50,000 word thing will eventually be edited. I liked the plot I had, and the characters, but the prose is dreadful and I know I can do better.