[pumpmylemma]

1) Explicit privacy policy that never stores DNS requests on a per-client basis. I haven't followed the ISP retention laws but they seemed to be getting more and more ominous.

2) While caching DNS record, when freshing up a stale record,

  if(isknownSeizureDomain(record)) ignore();

[ra]

Ah I understand, you're talking about a non-authoritative DNS server. I'm working on a DNS hosting service.

To solve your first requirement, check out http://www.opennicproject.org/publictier2servers

[pumpmylemma]

I was. Thanks for the great link!