your sure it's adwords? They have a toolbar program there that they use the same search for and I know that is against google's terms. I've only found one other company that G has allowed to use their search in a custom app - and I think they got in before google became big and still allowed things like that (unless you already have huge quality traffic- but that's another story...).
the search only brings out 'sponsored results' as well - which looks more like a Miva or other 3rd tier search than google...