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As for Google, I really think it could come down to a manual check and a possible decision about whether the disguised links were a site design issue or an attempt to manipulate rankings. If you make disguised links out of a bunch of keywords in an area of the page that a user normally would not think to mouseover, that could IMO trigger a penalty.
[edited by: jomaxx at 7:58 pm (utc) on Mar. 21, 2003]
A Study On Link Display And Their Effects On Reading [webmasterworld.com]
But if the links are part of the menus that provide site navigation, then I will often remove the underlining purely for presentation purposes.