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I don't think it's that clear cut anymore. There's reason to believe that Google is picking up URLs from Javascript pop-up code, so I don't think this is something you can rely on.
It would be highly unusual for Google to object to a menu though - can you sticky me the URL?
I've taken a look (thanks for the sticky).
The good news is that these pages *are* in Google and do turn up for searches for their title tag text - which is the important thing.
Because the unique page content is relatively small in comparison to generic content (including the menu), Google does consider some of these pages as 'similar'. This is not anything to worry about.
I can't see anything here which would qualify as spam. I think it's far more likely that because these pages are buried quite deep in your site that they are not inheriting much pagerank and therefore are reporting back pagerank as less than 1.
If you look carefully enough in the SERPs you'll find pages with this menu on reporting a pagerank of 1, suggesting that this section of your site is fairly borderline in regards to PR.
So no, I don't think you've done anything wrong, and I don't think Google is penalising you at all. If you need to increase PR on these pages then you'll need to alter your site's linking structure to bring them closer to the surface, but I'd suggest that the gains would be minimal in comparison to other forms of SEO you could do.
Its a text (folder) menu on the side of my catalog and its on every page and I think Google may be considering it spamming
Google will definitely not consider this spamming.
That is a common technique to get a flat PR and a convenience for your visitors.
