I've heard rumors on the grapevine that Yunnan Mag is going out of business. Is that true? I also heard that they falsely advertised(put up ads for companies like Korean Airline and Puma that the companies didn't pay for) to promote themselves. What's the story here?

don't know about the alleged free ads, but the magazine is definitely out of business. they were operating at a loss.

Yes, it was losing money from day 1. cctv13 has a point, when you check out their ad pages, things don't add up. BIg companies usually don't advertise on no name startup magazines. All in all though, it was a good concept, but probably ahead of it's time as it never found the reader base to support it.
RIP Yunnan mag.