mcdarwin - 8:54 am on May 29, 2010 (gmt 0)
Your results sounds prettey solid already. Try make the client acknowledge that and don't promise them to much for the future. Clients are usually impatient when it comes to results and when you are done with the easy wins such as killing the none performing network ads, results may be less visible and take more time.
You are on the right path, and now they have tracking - if they don't look at it themselfes at least it will be very helpful for you or for any other SEO they ask to help them in the future...
Can't advice you much whether you should remove links from worthless directories. Personally I wouldn't want them, but since I don't use that strategy myself I have no experience when it comes to results or risks. I wouldn't add nofollow to outbound links if they are relevant, and in general I wouldn't have outbound links on my site if they where not relevant.
PR is not the right metric for your client, I have a PR3 site that brings in more business than a PR5 site with a similar revenue model.