When I first started my link lists, the majority of my traffic was SE traffic. I was really good at getting ranked for the keywords I went after, and had excellent conversions with sponsors. In my heyday I had 7 out of 10 on the first page for one keyword I went for.
I got spoiled. Now Google hates me. Yahoo and MSN I still do good, but you are right. I will probably never get back up like I was in Google, and should stop freaking out over it. Now more of my traffic comes from recip links then SEs, and I should work on that rather than trying to make the SE's happy.
But it is frustrating when I've done nothing black hat or even grey hat for a long time and watch my sites recently get devalued. And have no idea if they will ever get pr again.
So now it is old fashioned submit sites, get traffic again.
I don't think I will go back to category recips because I plan on splitting my categories up over time, and I also want to do the same thing to xxxporntastic I did to trc, put all my categories on the base domain on keyword pages.
I'm also going to to change the text for my recips often, so when people grab new recips, I end up with a lot of different keywords pointing to my sites, and not the same anchor text over and over again. But you all are right, I'm never going to get rid of recips entirely, and they do bring a lot of the traffic.