There is absolutely nothing wrong with an unpaid internship. I had a couple and they were invaluable.
If one wants a paycheck one can find a job. Otherwise being paid in experience is often a very smart move. (But not always.)
The practice, especially common in competitive industries like journalism, finance and filmmaking, could change if the appeals court upholds the ruling of a federal judge in New York who found that moviemaker Fox Searchlight Pictures Inc. violated labor laws by not paying two of its interns. Cases have also been brought against Hearst Corp., Conde Nast Publications and the Public Broadcasting Service’s Charlie RoseShow.