rlange - 2:25 pm on Apr 22, 2011 (gmt 0)
I'm still studying this area, but the strongest correlation I see so far involves collateral demotion for pages that link TO the "bad" page, not pages that are linked FROM it.
Have you seen, or even looked, for any correlation between a demoted page and external links to "bad" pages/sites? I imagine not being able to see Panda's effect on that external page/site would make that difficult, at best.
I ask, because I've seen the idea brought up elsewhere in this subforum, but I don't think it received much comment. If internally linking to a poor quality page is bad for the linking page, then it seems reasonable that externally linking to a poor quality page/site may also have an effect. In the same way that you feel Google doesn't want to send people to "bad" sites, they may also not want to send people to sites that associate with "bad" sites.
That's also something that I think can't be easily abused. The webmaster is in almost complete control over external links and in situations where they don't have that control, they almost certainly have enough to "nofollow" those links.