everyone is saying hidden links are bad and are part of black hat SEO. Everywhere it is stated as a link that cannot be understood by the visitors. Now I am really confused with the explanation that how to identify that? Please help me with some simplified version with which I can use to identify hidden link
Links that are put in divs or objects or elements that are hidden are considered black hat, because they are being inserted for the purpose of giving link juice to a site or are intended for only the search engine to see. An example is: <div style="display:none"><a href="http://www.mylinkosaurusrex.com">Link</a></div> Code (markup): Google detects that as an attempt to hide links and may penalize a site for doing this (assuming it does a few other things that google flags as suspicious). You can use css to hide links or to disguise a link, and google can't detect that yet - doing that is considered grey hat meaning that Google can't pick it up and it's murky on whether this is ok or not. It's generally considered bad to do that however. You might want to read this.
I disagree with that. almost all the tableless design uses (hidden) drop-down links. may be google considers external hidden links as black hat but internal hidden links are too common.