I heard that if you have all sites with same IP and make them link to each other, Google will ban them because they assume you try to increase your link popularity. Google don't like webmaster increase their link popularity and Page Rank with their own website that has same IP address. Is that true? Thanks in advance for all input.
I don't know about banning but I know that Google sees it and acts accordingly. Put your sites on different web host accounts and don't make the links reciprocal. For example me I have 9 sites and they all link except two of them heavily to site A and B but site A and B, does not link back to them but A links to B which is my most important site. And they are all different IP's. (This is not fully followed by me but almost) In this case I think (or hope) that it cannot be seen.
I'm not going to say they will ban you but, it doesn't work so favorably. Even having the same class C address can "dampen" the success of your link site promotion. The idea is to have sites outside of you link back to give quality links that show as not your own. Of course, there are always an option to get around these limitation and people will "push the limits". The question is: Is it worth it to you? I personally would avoid having a second site with the same IP address. It is more appealing to have a truly different website (if the content is different) on a different IP stack (at least different at the class C level) to point to other sites of similar theme I am promoting. IMHO.
I've experimented with this a bit since I run my own servers. I'm not sure at what point (or if) Google would start banning because they think you are a link farm. But I can say that in one case I have about 45 unique domains on the same IP that all link to one of my sites (and many link to several of the other 45). I probably haven't seen as much benefit from those links as I could have if they were on different IP addresses, however it doesn't appear to have hurt me.
That I also believe but I think that the benefit is lesser. One evidence I saw on this is when I did a "link:mysite" I saw that I had in that time several sites with different domain on the same IP and on the list that came after the query, those sites came after each other on the end of the list (page 6 or something). This even though it was total different sites. After that I got more web host accounts.