Well, you know it lies between both. Now when we do directory, bookmarks, articles submission etc then according to rule for every site content should be unique, but every one submit same content for all possible sites. Therefore this mix strategy is Gray Hat technique.
Grey Hat SEO is mix of black hat and white hat techniques. Using Black hat techniques in ethical way and can not be catch by search engines is Grey Hat SEO.
Means Use of White hat and Black hat both technique in onpage activities. For eg. In Metatags you create title of 70 character and description more than 150 characters. It is called Gray hat SEO.
you know what they say... if you can't do the time, don't do the crime. google may not catch you today with the current algorithm, but its constantly working on modifying their algo and no one can guarantee you will not get caught tomorrow. its always a safe practice not to use any questionable link building method for long term benefit. after all, its not hard really. all it requires is a clean mind set. i have seen many sites ranking high and now they are about to go out of business because after panda update, their sites are nowhere to be found. i don't think any business can afford to go out of business after the next algorithm update so better be insured from day 1.
Yes I am pretty sure techniques for back linking which is possible now I'll be caught by google. To actually be not affected we just need to do very little SEO. If you read google's blog they now recommend t not build websites for search engines but by members.