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The very first thing that strikes me here in this is you say you have about 12,000 links from only 48 domains.

Site age may be helping them but I'd be willing to bet that they probably have a more ip-diverse link profile than you do as well. Sounds like you have the niche relevant links down so now its time to get outside that box and start going after other metrics. Here are the big 6 I look at:

Trust/Authority
Niche Relevance (you have this covered)
Segmentation (where the links appear on the page)
Anchor
IP diversity (links from many domains > many links from few domains) <- start here
Link-weight (link juice, pagerank, whatever you want to call it)

I'd be willing to bet your 80 bucks would be better spent on something like a pauls or angelas backlink packet than it would be on renting one or 2 links a month. And a lower risk too.

you may see some initial drop as google figures out where your content went and how its being repurposed (even with smart 301ing you are still chunking up the content)

HOWEVER, wiki-style internal linking has proven to be very effective! I mean... all those rich anchors, links in the content instead of the nav.. these are all nice signals.

Im fairly certain wiki comes outta the box with dofollow for internal links and nofollow for externals however you can change all of this stuff with settings and plugins.

All in all I'd say if you are willing to commit the time its going to be a net gain both for your rankings (over time) and more importantly for your users.

Hmm. Well there is a LOT of ground to cover here but I would say the short version is it sounds like its time to rebuild your website. Depending on the size and scope of the project my firm may be willing to take it on pro-bono. We actively give to charity every year and though that usually means monetary donations I would absolutely be interested in donating something that we do best!

Now to the core of the question, yes having everything on a single domain is usually better. There are situations were subdomains are appropriate but without more information I'd say this is likely not the case for you. I also think that having your subdomains hosted in different parts of the world is likely sending some really odd signals to google as to the connection between your subdomains and the main site. I would definately try to get the whole site hosted in one place.

I can't fathom a good reason to use iFrames in the senario you are discribing instead of just self-hosting the content in the correct location.

Oh man this is me to a T. Its hard to explain to others that the rest of the time spent farting around online is really a primer for this. If I just tried to come in for an hour and leave It would never be an in the zone hour.

small caveat to the endorsment above... IP diversity does seem to be a rather important ranking metric. It's been my experience that Quantity and Quality need not come from the same source. If you've got some great quality links, and a bunch of quantity only type links.. it seems to still result in a net positive.

Six things I normally look at linkbuilding wise (in no particular order):

Authority/Trust
Niche Relevance
Segmentation (links in content > links in sidebar, footer, comments)
Anchor
IP diversity
Linkweight (Juice, PageRank, whatever)

As long as you have elements of each of these SOMEWHERE in your link profile you generally do well.

Other than that I agree with these fine folks. Also automation is great for scaling but it almost always leads to a great reduction in quality and possibly could end up being a wasted effort if the rejection rate goes up enough as a result.

That could very well be it. I rode the line on a lot of things but ad placement wasnt really one of them. I just have the standard 3 adsense blocks and they are well placed and blended into the site. I also intentionally sold some links on the site (like I said its a testbed) but they arent designed to stick out like a sore thumb so I doubt that would make a diff one way or the other.

P.S. Haha fruedian slip of some sort I'm sure.

Oddly the handful of sites that I have which should have most probably been affected negatively actually saw boosts in traffic, CTR on ads and eCPM on ads. Not huge jumps.. but yeah.. I benefited which was odd. These domains are testbeds I set up a long time ago to find the upper limit of what you can "get away with" in google so I know where to draw the line.

Other interesting facts. I rand some tests over the weekend (may not be large enough to be statistically relevant yet) but it seems the farmer update has almost no impact on indexation of poor or duplicate content given enough raw link juice (no anchor, ip diversity or any other cool factors, just a flat link from a big ol' bucket of link juice) which I find disappointing. =/ I expected a bit of a challenge after all this hoopla. Even though I rock the greyhat Im still pretty anti dupe/crap content.