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Would this be considered a paid link? Where is the line drawn?
Nice business model too. Are those arrows pointing at the ads legit? How about the request to support our sponsors?

Get a few hundred million in VC funding, buy some old domains. Fill the domain with user generated content. Place a thin layer of link schemes and please click ads on the top. Web 3.0...Wow. Exciting times.
Also, learn how to rent millions of links in a Google friendly way.
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"Would this be considered a paid link? Where is the line drawn?"
... is it stating the obvious to suggest that whenever PageRank is mentioned in a link request the requestee has probably just breached Google's Mendoza Line ( http://en.wikipedia.org/wiki/Mendoza_Line ) ?
I have a feeling these folks are going to get slapped down pretty soon...seriously, if you have a domain that's worth at least 4 figures, you shouldn't pull stupid stuff like this.
I smell a penalty coming.
I bet your sense of smell is wrong. I think they are too big to be penalized. :)
I doubt Google would have a problem with this so long as they don't try to implement this on a really large scale. Or unless Matt is really bored one weekend ;-)
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