It really all depends on the value of the website and your service that people are signing up for. The higher quality your service offering, the higher quality leads you need in my opinion. Also, most websites make members verify with a valid email address, so it is very common.

I like the idea of lower signups, but higher quality. However, don't think of it as higher quality. Think of it as more highly qualified and targeted leads.

Bottom line: I would go with less "higher quality" signups.

Bruce