Selling Links & Get Penalized by Google?

Hi,
I saw a video on Youtube in which Matt Cutts mentions that it ain’t good buying links and he even says that Google downgrades sites that sell links on them.
We run several sites and we partly live out of selling ad space. Embedded links into content, banner ads etc.
We have tons of quality content and a good base of visitors.
We also run a few directory-like websites, which still have plenty of useful content on them. Perhaps Google doesn’t like directories any more?
Question:
-how bad is this in terms of effect on SERPs?
-the problem is with the fact that we actually mention on the site "buy an ad here" or "get listed for X $"… should we hide that? and say something like "contact us to get listed here?" >> would that help?
-some of our marketing efforts are concentrated on buying links… Google can tell which link is bought and which not?
I […]

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