The SERPs are in the laps of the GG, Google Gods, they've created this unholy mess and I think, from what I'm seeing moving around, they're attempting to sort some of it out but the problem is, of course, as soon as they resolve one thing they create another problem elsewhere.
They really need to take things back to basics, IF they can, and rebuild their entire database, which is a darned more difficult to do than just write about it.
I'm not even sure which way I would go about it however I know I'd probably stop adding so many new sites and pages so fast and I'd certainly be looking at all the garbage hosted on blogger. They've got the money to do it, this isn't about being able to afford it, it's about clearing all the crap abusers out of their, yes THEIR SERPS.
Posters keep pointing out that it is Google's business, of course it is but for how much longer will they have one if they don't sort it out? Things could move extremely fast if more unsavoury Google revelations come forth.