Hello Robert,
First of all, thanks a lot for such a detailed response. Allow me to post my comments -
1. The list of changes I made is limited to what I mentioned in the first post. I never messed around with meta description, or link building or anything for the sake of 'SEO'. So that's not what I'd look at.
2. Most important point: The traffic to blog is almost normal (just down about 10%, but it bounces any-time we publish a breaking news).
3. It's the traffic to our community: http://www.crazyengineers.com/community/ that's getting affected. The sidebar was introduced on all the /community/ pages; the blog has remained intact, except for the bulk removal of tags.
So, I'm wondering whether it's the 'tag' removal from blog that's affecting the 'community' or something else? If it's the page layout, then I've already removed the ads; and now have only 1 ad-unit above the fold on community pages, and one below the fold. This is no doubt, acceptable.