Clearly, many webmasters feel that they were unfairly punished. I can certainly sympathize with them, but I do see what Google was trying to achieve with this.
One of my niche websites was hit (or at least I think it was -- you never can be entirely sure with search engines!). I was angry and disappointed at first but on second thoughts I realized that I was definitely over-optimizing it.
Firstly, I had several pages that had a common two word keyword phrase in the titles. Even though the content on each page was unique and different, this was a big no-no! That was pretty dumb in retrospect but I chose to include those words because they did reflect the purpose of the pages, and I was in a bit of a rush to build the site.
Secondly, I'd done a lot of article marketing for that website. I must have submitted about 25-30 articles in the last several months. These were all unique, and not "spun". I did vary the anchor text, but in retrospect I didn't do this nearly enough. I didn't endlessly repeat exact keyword phrases but I did use some words over and over again, even if they were in different combinations.
Thirdly, I didn't pay enough attention to the pages themselves. While they certainly had some useful and relevant information on them they were pretty general in nature. I should have spruced them up more and made them punchier, more specific and informative. I was always intending to do this eventually, but basically became fixated on getting lots of article backlinks because they really did seem to work well and my traffic was rising steadily.
I wasn't trying to trick Google, but I was certainly being way too overzealous with certain techniques. Clearly, there was an imbalance between the amount of work I'd put into the on-site content, and my backlink building. Google picked this up and slapped me for it.
It's been a good lesson. Basically, the main thing to remember is to keep focusing on the content of your site. As the search giant keeps saying, build sites for people, not search engines.
So now I'm going to pretty much forget link-building -- particularly via article marketing -- for a long while. Instead I'll be putting almost all my effort into writing lots of quality content for my websites and blogs.