I remember aspects of this - the proliferation of spam .cn sites - being notice in this forum weeks ago. http://news.bbc.co.uk/1/hi/technology/7118452.stm
That's worrying. I always thought that it was difficult to overtake legitimate sites for competitive keywords as natural links should always be more powerful than 100% spammy links.
such temporary spams on google will always happen, but you should forget about them and just focus on benefiting from google in long term