The automated version might catch out the clearly "abusive" forms of 2 and 3 way linking, but it's hard to imagine on the 3 way linking automation could cope with it, without effecting a lot of innocent sites.
I kinda think the most reliable detection is competition reporting SPAM links to Google.
The next level of detection i would speculate would be to flag URL's and networks that look suspicious and then have them weeded out by human editors at Google.
I guess the real worry is those guys that do serial spamming as a full time occupation, which must really irritate Google etc, and i think this is where Google focus' it's efforts. Quite how they identify these would be interesting to know, but I guess it's a combination of backlinks, content , C Blocks , whois , target sites and originating sites and perhaps theme.