i believe the "donate" model works in certain instances, but it's nothing you can count (or depend) on; at least not from the beginning. "certain instances" might be very famous artists who use it as a marketing stunt to get a lot of free press. this might cease to work when the novelty wears off. most likely it doesn't work for unknown artists at all.

but: counterexample! dwarf fortress! this unique game finances one dedicated full time developer since (felt) decades (though i'm not on top of developments in recent years). it works because it's a niche product with an incredibly dedicated fan base. and the developer puts them under pressure: he'll work on the game as long as he can live off the donations. as soon as people stop donating enough ...