Why aren’t directories considered link farms? Just because they have links in appropriate places? Or is there some other reason?
Who told you they are not considered link farms? With all my respect, but most directories are considered link farms by some But most directory owners have as target NOT turning their directory in link farm, so they do everything to avoid that.
Quality of listings, unique category structure, new mods, comprehensive design. These are some criterias
1) Relevancy of the links: Only add relevant links to the section. Proper categorization helps. 2) Keep the links less than 100/page 3) Have some Good quality links too. Don't add too many links that are PR2 or less. The above 3 will help you stop becoming a link farm, if you follow all the 3 rules.
Most link farms simply list one link after another. They may even be categorized and limited to only a few on a page. What IMHO makes a site a directory rather than a link farm is the additional content that accompanies each listing - the descriptions.