I think it depends on whether you want to leverage on Google to further expansion of your site’s reach and extra monetisation/business, and how much you want it to contribute in that aspect.

If you want it to be a huge part, then there is no question about it - you have to play by their rules. It is partly about integrity (as Tomaz has rightly pointed out - if you want them to help you, you have to be in their court and not do something against their rules), but it is also partly about giving up your own authority and rights to the paymaster you need to live by. Sad fact of life we all have to live on something. The first step was to even come up with this concept of PR. Surely they must have realised that commercialisation of PR would result with such great emphasis placed on it. Why only act now when other business models have been built on top of it?

And to my friends who mentioned to concentrate on content and traffic, that is partly true. But you all know which is the biggest content referrer now for most sites. ;)

Still, I am very appreciative of all your support and thoughts - it helps me to understand the issue further and think clearer. I should concentrate on leveraging on my strongest points in making a living - and that is to write. :)