When I hear the word I think of Linux or Wikipedia, and when I read William's and Bart's posts on the matter I think they are rather influenced by their political leanings.
The problem with citizen scientists I think isn't that science is too hard for non paid private citizens to contribute much, it's rather that most citizen climate scientists are "on the wrong side".
Now I really like William, it just so happens that I think he goes a bit gooey when talk turns to paleoclimate and temperature indexes. Neither I categorise as hard, difficult science requiring great minds and all. The tree ring stuff I see about in the same light as so called technical stock market analysis and working out the world's average temperature is a task for glorified national statistics offices, the people who work out inflation or average life expectancy data and the like.
The main reason citizen scientist contributions don't amount to a great deal in the case of these two subsdisciplines of climate science is that no amount of effort will provide a great deal of return for tree rings, and for temperature statistics extra effort at gathering good quality data is what's really required.
As for funding, I'd defund the tree ring scientists entirely, and am no longer convinced there's any real benefit in improving the temperature indexes.