I don't think donations are workable as a way of funding open source projects. The most successful companies in this space have either a freemium model or they charge for documentation, customization, and support. Is there something in your product that users can't live without that you can charge for? The rest of it could be free minus that one feature.
It's also perfectly acceptable to offer a free version as source only for those folks who want to compile and update it on their own -- then charge for the compiled version with automatic updates.
It's also perfectly acceptable to offer a free version as source only for those folks who want to compile and update it on their own -- then charge for the compiled version with automatic updates.