Air - 12:42 am on Apr 23, 2002 (gmt 0)

>is google just trying to scare us ?

IMO it's like travelling the highway, there is a posted speed limit but not everyone is travelling at the same speed. Some travel faster and some slower, and even as those exceeding the speed limit pass a police radar they don't get pulled over. Does it mean the posted limit is just a suggestion? No, it is the limit and can be enforced, more so if your car flaunts the fact that it is travelling faster than the speed limit. Real loud exhaust, fat tires, known fast speed abusing car, are all factors that get you noticed for closer scruitiny and maybe penalized. If you are exceeding the speed limit by a large margin then its only a matter of time 'till you get nailed.

It isn't that different with cloaking and SEO in general. Stay under the radar, don't draw attention to what you are doing, don't exceed optimization limits by too great a percentage. Get to know the roads you travel, some tolerate greater deviation from posted limits, do this and you are less likely to attract closer scruitiny and possibly be penalized.

Cloaking alone will not improve you rankings unless you have some design elements that are hurting your rankings. In that case cloaking can help by serving pages to search engines without those indexing constraints. That's is what I am seeing cloaking being used most often for these days.