I have just signed up for some free web space. One of the ones were they give you a sub domain. Am I correct in thinking that I can place a load of cloaked pages on this free space and even if the SE's catch then, this will not affect the site I am redirecting too? Don’t want any of my "white hat" sites getting banned..
I know this doesn't answer your question, but stick with White Hat. Black Hat techniques and cloaked pages ruin the fun for everyone.
the site you are redirecting to is safe otherwise everybody will start cloaking traffic to their competition
Agree. If you create 301 redirect for black hat purpose, you are killing yourself, imo. 301 redirect means "permanent moved" that means after 1st indexing of your subdomain from free hosting, SEs will take it out from their index (b'coz you tell them that the page is permanently moved), they will erase the subdomain and use the main websites. Thus, nullify the purpose of having the subdomains. Use cloacked page for affiliate marketing. Don't use it for black hat, you will always be one step behind Google which has millions of budget on programming.