I have been in touch with a lot of directory owners, free and paid. Also blog network owners and many have lost PR and SERPs ranking. I think it is simply from Googles new 'Report Paid Listings' For those who report paid listings, DP is a gold mine for these rats. Killing a persons business because Google says so is slimy. I think the whole directories situation and blog network problems is as simple as that. If you own a network hide the urls somehow or they will be next. Interlinking paid directories have felt Googles 'big stick' Free directories seem ok as they are mostly individual and not networked.
:O can ppl report paid listings??? omg.... r u saying ther is some kind of reward?? omg.... i gotta get in on this (jks LOLZ) well I only have 1 paid directory and ATM its ranking extremely highly for a free web directory so hopefuly google wont see it as a paid one for a while. I ahve a network of like 3 (yes count em) freee (yes freee ) directories. You said free directories mostly go unpunished.... will mine??? yes they have network links to each.
I think 3 in your network may get away with it and yes if they are free. But some big paid directories have dozens all interlinked and owned by the same individuals. I know some blog networks also got hit.
See some beautiful explanation from Rand Fishkin http://www.seomoz.org/blog/what-mak...y-and-why-google-penalized-dozens-of-bad-ones
I have tried a lot of directories some paid as well. So far there is no help in getting more traffic.
Rand Fishkin also comments: "if I were Matt Cutts, I'd just tell one of my quality control guys to go spend a few days trawling DP for directory domains"