I meant to highlight that. People choose an easier way to describe things. In this case 'nofollow tag' has become a popular and well-used phrase and we should stop correcting people ( I used to correct people very often but now I see it's gone way beyond the stage where it can be corrected )..
I firmly believe that "no follow" links do no harm and may even help your website in the SERPS. An organically linked site that hasn't had an "SEO" link building campaign is bound to have a percentage of "no follow" links. Its really only SEO geeks like us that even know it exists. Surely the google bot is clever enough to think that a site with a high number of back links without a single "no follow" is odd. I have no prove of this but my ranking results are good and most of the sites have a mixture of "follow" and "no follow" links. Themed links are most important and place you with that online community in Googles eyes. I believe many SEO miss good links as they are so hung up on "no follow".
You're mostly right, vikingraider. They wont hurt you, but they won't help you (rankings wise) either. However, the traffic they can send your way can be anything from a dried up lakebed to a flood of Biblical proportions.