I love ethics, so I'm just gonna throw some things out there.
Sure it's all legal, because it's Google, and it's not just them, take a look at FB!
But let's get into actual examples:
Let's talk about how one of the biggest "discount" based coupon platforms used one of the most aggressive popups I think I've ever seen devised. So heavy duty that only if you were an IT expert could you close the window. And these guys were on Adwords everywhere.
But don't take my word for it, read it from the horses mouth
In terms of the ethics, well let's just say if you have a budget, I think that you can pretty much put a line through most of the Google Guidelines, as I've seen them gamed for a loooooong time.
Trouble is that fundamentally Google has an achilees heel, and so even after a site has been manually reviewed and pushed off the first page, it can be put back again. Just don't tell Matt Cutts.
Google's always been a flawed algo, and it's been a pleasure to work with.
May there be lots of "changes" and continued advancements soon, and may my clients sit squarely at number 1 in the organics.