We have a few niche related websites maybe 5 in total some on shared hosting and some not. They all have a link or two to each other but I have no followed all of these. In no way are we doing anything wrong as the links are all helpful. Question is: Would google see this as a network and are we safe by no following the links?
if those sites each have its own unique/original content you will be ok as its only 5 sites... ======================================= High quality Content writer | SEO writer | reviews | 100% original content
If you've nofollowed the links between your 5-site network then the links authority is worthless. I wouldn't bother with a link-wheel structure, randomly interlink the 5 websites together with dofollow links, include some deep links (to inner pages of each 5 site), make sure you have dofollow outbound links to websites which you don't own, youtube, wikipedia, etc, this will make your websites look more natural and not like a network. Send me a PM if you want me to take a look at your 5 sites and give you a mor detailed analysis.
You're probably just fine and shouldn't see any sort of a penalty from Google on anything. If you are actively promoting the sites between each other, you might want to disclose the true relationship between the sites. I watched a good video on undisclosed content relationships by Matt Cutts this morning:
If the goal of the "network" is traffic among your sites than you are doing it fine. Nofollowing the link is a good idea. If on the other hand you are building these links for pagerank and SEO reasons then you are doing it wrong. The links should all be on different IPs ideally and not interlink to eachother. There should be a strategy behind how you link each site if it's to increase your rankings.