tedster - 4:31 am on Mar 28, 2012 (gmt 0)
Right now, Google's quality consideration seems to be about getting the first page to hold results their users like - especially for high volume searches. They seem willing to sacrifice some good quality results as long as the first page "works" for their users.
It's far from an ideal approach, but they seem to be willing to let long tail searches provide traffic to websites whose signals do not line up all that well.
I don't see Google backing away from penalties for manipulations, no matter how good the content. The only exception seems to be that penalties may be much shorter for sites that are "too big to fail."