Why did circuses exploit people with birth defects? did people really pay to see them?

Curiosity: Circus sideshows embodied curiostiy and quirky spirit. Human nature finds colorful, different and exagerated promises interesting enough to pay and watch. As early as the 1930's people began to raise objections to the "human freaks" deeming them shameful pornography of the disabled. By 1970's laws were passed to kill these traveling sideshows.

Yes: Neonatology started as a side freak show in the chicago world's fair in the early 1900's when the incubator was invented and people paid to see the "world's smallest babies". There has always beeen a fascination with defects and babies in general.