That does seem incredibly naive. Maybe the problem is not so much that it was used to spread malware/illegal content but that it failed to reach mainstream adop

That does seem incredibly naive. Maybe the problem is not so much that it was used to spread malware/illegal content but that it failed to reach mainstream adoption and as such was mainly used to host malware/illegal content that would be rejected by other hosts, while not generating a lot of good publicity and new users for Firefox?