2
I don't think it is infected. You have the source, so you can compare the files with the official version.
It is based on a rather old version of News: 1.53 Since then a lot of bugs have been fixed and some features added. Some of these bugs may have security implications.
As far as I can see, the code used to implement the adsense feature is rather limited and there are only a few files involved, so it would be easy to transpose them on the current 1.63 version.