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You are right: this IS a myth and it is still alive and well in some SEO and SEM circles, but you have my word on this: it's not true at all so you can rest your case on it. If it would be, Google would loose considerable credibility in its PPC program.

Remember that Google's AdWords program is it's number One revenue generator. For a company that is just about to go public, do you think they would want to risk that? For 2003 alone, Google's revenue was in the vicinity of about $ 800 Million, of which about 95% came from AdWords. I don't think Google would ever risk that, at any cost. They have too much riding on this, not to mention their credibility.

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