You're not imagining things. I hate when people do that. It's to scare off people from downloading from them to free up bandwidth.

LW could easilly "rate" your connection speed by constantly analysing your up/down-load rate while you are online and then reporting it as a numeric value, then you'd know what a users "true speed" is and how long a download will take (a very busy T3 can take longer than an idle modem).