its backlinking, basically they find sites that have any relevance they can get even if its just a couple words, the bots register and set profiles that link back to the selected site to boost then when google and other search engines grab the sites pages they find that profile and take the words from the profile the weight of the site the link appears from and use that to calculate the rating of the other website, the more sites that link to your site with relevant details the higher up the page rankings you go and thus creating a free high pr domain for ome spammer to sell crap from.
Captcha is really hard thing to get right as there are so many different ones and so many bots that are designed to get around them, if you know any php then I would look at doing what we did on the 3c website and introduce an about page and then on the register page ask them for details from the about page like what day the site was founded or who the lead admin is etc as this isn't a common captcha and thus makes it harder to create a bot to get around it, then change the requested detail once every couple months and you should find the bots can't get in anymore.
