[itengelhardt]

First of all, I refuse the notion of "ethical": IMHO Google is NOT a moral instance and does not get to decide which behavior is ethical and which is not.

However, they get to decide which links they consider "valuable" and which not. Which in turns affects your rankings in Google's SERPs. They claim that they do punish websites that use paid links, but in reality it is safe to assume that they do NOT catch every offender (probably far from it).

I personally do not pay for links, mainly because of the fear of getting caught (and punished) by Google. ViperChill.com is a great resource for less Google-certified SEO techniques.

Additionally, you might find this article interesting that goes into great detail about the value of links in general and the market for paid links: http://blog.linksspy.com/paid-links-price-study/

Disclaimer: I am the author of that article and also the maker of https://www.linksspy.com