Don't go grey. Don't rat either because it won't do any good unless many others do the same. Google seems to ignore the one-off requests.
Maybe a bit off topic, but I think the bigger problem here is that Search Engines don't reward White Hat practitioners as quickly as they do the Black & Grey Hatters. The latter sees immediate results by manipulating the system and the penalties are not assessed until week, months or even years afterwards.
Search Engines have made such great strides in many areas but are still lacking in the penalty department.
With search becoming more social, I don't see how SEO and reputation can't do the same. Search Engines should use cues to help trust websites by having developers, designers and SEO's alike "sign" their work. They can attach these sites to their profiles or add a personalized meta tag signature. Having these tags could help Search Engines fight spammy techniques and even offer up suggestions to improve the sites on a more personalized level, without calling anyone out. They can penalize while educating.