However, instead of all the product pages (with my custom header and navigation links back to my site) returning a 404 Not Found, the merchant is pointing all those defunct links back to their home page.
As a result, some 3-4 weeks after terminating the affiliate account, GWT is still showing hundreds of inbound links to my site that are actually 404's that are being redirected.
To make sure I understand: 1.) There are no links on your site to the 404 pages.
2.) The merchant used to have custom pages for you, but they were exchanged for pages with links to the merchant site's home page.
3.) Google has not picked up the changes in the links yet
[or at least not updated your WMT info to reflect the changes], so in your WMT account it shows them as pointing to pages that would
[should] return a 404, but...
4.) The pages on your site that would
[should] return a 404 are being redirected somewhere else.
If the preceding is the case: 1.) The links will be dropped from your WMT account as Google re-spiders the merchant's site and pushes updates into WMT.
[Sometimes WMT can be slow to update and buggy, so I'd don't stress on anything it reports too much when I know things have been changed and will be picked up and updated in WMT eventually.] 2.) If it's what *should* be 404 pages on your site that are being redirected, the best you can usually hope for is a soft-404 being detected, so it's usually always better to serve a 404 for the URL and then use a dynamic custom error page to "take the content to the visitor" on the URL they requested rather than taking the visitor to the content via 301. EG Rather than redirecting /foo/widgets.html to /foo/ serve a 404 on /foo/widgets.html and "grab the content" from /foo/ dynamically to show the visitor when they visit /foo/widgets.html.
[I usually add a notice about the content requested no longer being available, but here's something similar you might find useful.] I can't help wondering if this is might be seen as link manipulation and be related to a hit by Penguin?
I suppose it could, but if you weren't hit by Penguin with the links and live pages on your site my guess is it's more about losing the links
[especially if they were follow] and redirecting pages that should be 404 to "not essentially the same" content, which is usually interpreted as a soft-404 and AFAIK drops any inbound link-weight just like a 404 would.
So, I'd personally guess it's likely the other way around and it's lost inbound link weight
[or even simply the lost content on your site] rather than some type of "unnatural link detection" by Penguin that would cause an issue.
