A common problem I run into with clients is when they have already seeded search engines as well as hundreds of Free-For-All (FFA) link sites. I've been reading that many reputable search engines frown on FFAs or "Link Farms" as a method of creating link popularity. Is there any way to undo this damage and get back into favor with major search engines?
You make a good point about dumping your competition, I hadn't considered that. I guess there's really is no reason for search engines to penalise people that have links on these sites other than to not spider the link farms themselve.