Hi Chris
Welcome to the forum. The notion of 'thin affiliates' being targetted by Google is relativeley new and no-one knows for sure whether this is being done.
The general antidote to this threat seems to be to create original content and play down or disguise the affiliate links and 'spam' content in your site.
Plenty of feed based sites do well, and there is plenty of traffic to go around. Though many new entrants are advised to focus on niche areas, as you pointed out.
Good luck and I look foward to eeing you around the boards.
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