Sha -
Thank you for this I am finding it incredibly helpful. I'd like to say that I have actually already used the trial version of the RMOOV software and do have a free account with your service. I was using it in the past before I was notified, knowing that this day would come and assuming I had a penalty already whether it were algorithmic or manual.
Anyway, I actually have copied the "polite letter" from Rmoov and have been pasting that into contact fields on forums and what-not that I am trying to remove links from. So yes, the effort to sprinkle in kindness is understood and appreciated.
I am going to post on the webmaster tools forum as you suggested. I am still confused as to whether or not we are actually penalized. I have yet to see any signs of penalties as of yet. In fact, the one keyword with 45% of our anchor text linked to is still climbing the rankings... I keep expecting to see it disappear entirely but today it has creeped onto page 1...
Anyway. Thank you.
So far I am contacting the sites I cannot remove and I have a spreadsheet going with lists of URLS and columns reading: "Link Found?, Able to Manually Remove?, Webmaster Contacted?, and Response from Webmaster?"
I'm hoping this will illustrate my efforts to Google should I need to resubmit.
Also, in regards to the "contacting the site who we paid for link building services" suggestion - Yes. I did that immediately way back in December. I insisted they shut down all campaigns and also took lists of URLs with passwords from their website and went through the spreadsheets, followed links, logged in and removed our backlinks everywhere I could. So I do have a few spreadsheets full of the results from those efforts to submit to Google as well which should be beneficial. Unfortunately that was all done back in January and we are just now getting penalty notices...
I wonder.. I launched a new website this month. The old website was redirecting to the non-www and the new one redirects to the www... Could this have brought on the red flag to Google?
Anyway. Thanks for all your help, and sorry for the incredibly lengthy narrative above.