deadsea - 11:34 am on Feb 22, 2013 (gmt 0)
I have personally reported dozens of sites. In my experince, Google doesn't act on the reports.
At one point one of my competitors was buying links from a really shady blog network. Every few days for months, the links he was buying would pop up in my news reader where I had a Google alert set up to watch my competitor. I dutifully reported every single shady site he got a link on. Nothing happened to my competitor's rankings. After months, the links finally stopped showing up in the alert (although I think my competitor is still buying shady links). Google must have updated an algorithm to recognize the sites as spam enough to at least not put them into alerts. Hopefully the links are hurting my competitor now (or at least not helping).