So one of my sites were pandalized, I ranked #1 for widget for years until of course Panda came to be. Now after panda it was dropped to page 5 or so and has slowly worked itself back to page one (#7) or so.
The thing is when I look at the country specific servers outside of the US I am no where to be found. I went to page 20 or so on the UK Serps and couldn't even find my site!
The answer to the question in your subject line is most definitely "yes" - When Panda 2 was rolled out the comments from Google employees made it very clear that country-specific handling was going on.
In the case you brought up - did it rank #1 on both .co.uk and .com before the Panda demotion?
I haven't brought up the geo-targetting in the Panda threads since it simply adds more confusion to the overall pie!
Without doubt Panda has affected country-specific searches, my UK registered and hosted example.com is having a torrid time in the UK SERPs but climbing back nicely in the .com SERPs however my example.co.uk is doing extremely well in the UK SERPs with everything now on the first page although it is nowhere to be found on g.com, I'm not worried about that since it is targetted at the UK.
I am now assuming that G has decided my example.com is my international site and that it is going to push that site in the g.com SERPs meanwhile at the same time mostly remove it from g.co.uk
I do know things have been moving this way for quite sometime but it's seemingly just become a whole lot more complicated for the way I promote my regional sites.
Interestingly my example.in so far has not had any issues with g.co.in