tedster - 7:26 pm on Mar 15, 2011 (gmt 0) [edited by: tedster at 7:51 pm (utc) on Mar 15, 2011]
From what I can see, it is both a site penalty and a page penalty. Some sites I work with saw some pages improve while other pages went down.
It seems to me like the process begins with a page-by-page assessment. A site-wide score is then applied, based on how many good quality pages versus low quality the algorithm scores. So it's not a black and white situation, not just page-specific or only sitewide.
[edited by: tedster at 7:51 pm (utc) on Mar 15, 2011]