diberry - 5:27 pm on Nov 12, 2012 (gmt 0)
The email says it's a Webmaster Guidelines policy. Typically, violating these policies results in a penalty, not de-indexing. There are sites which have copied many of my pages, photos and text, and DCMAs get each individual page removed with a notice in the SERPs, but the rest of the site remains indexed.
It may not take much (from a webmaster's view) to get a site penalized in Google, but it takes a LOT to get de-indexed.
I'd be thinking legal issues. Is there any way Google could think (even mistakenly) the site is promoting hate against a group, or piracy? I know based on the topic that's really unlikely, but as you've noted, this one's a real mystery.
Are you able to see independent caches of the site from the time before you were made aware of its problems? Just to confirm it wasn't a hate/porn/warez site which suddenly changed topics before asking for help? Again, I'm not suggesting this is likely, but I DO think it has to be something major like this.