I'm pretty sure that the penalty is real. Whether you call it a 950 penalty or something else, it's pretty easy to check for. To do that, follow these steps:
1) go to
http://google.com
2) click on "Advanced Search" ... this is to the right in small text
3) type in the search term (the keyword phrase that you're targetting) in the first field of the "Find Results" area that says "with all of the words"
4) change the "drop down" to the right to "100 results"
5) click the button labeled "Google Search"
6) scroll to the bottom of the page and click on the #10
7) click on the link that says "repeat the search with the omitted results included." ...note, you should really do everything without this step first and then do it if you don't find your site/page
8) use your web browser's "find" or "find in this page" capability to search for your domain name
9) if you're not on page 10 then go to page 9, etc until you find your domain
I've heard from folks that it's not too difficult to get your site (so far the penalty appears to just be a page by page penalty as opposed to penalizing a whole website) unpenalized for this particular penalty. I'm hoping that folks won't turn this into a lynch mob and see other familiar sites with this penalty and immediately assume they're a "bad neighborhood."
One of the things that I'm guilty of, and have some pages that have gotten penalized for, is hyperlinking in link trades to too many different sites using the same keyword phrase on the same page...ie linking to too many sites from my amateur page using the phrase "amateur sex" to link to each one. To fix this, I'm just changing the anchor text in the links to differentiate each one a bit.
What other thoughts do ya'll have regarding this?