I heard this news but this is totally inaccurate so don't bother it..

I have, and it is real. The affected sites are review sites that have raw (read that uncloaked) affiliate links. There have been some folks here affected as well. It has already happened so if you have not been hit yet you are probably safe this time.

It hit me today

Very, VERY disheartening

can someone explain this to a n00b please?

My opinion:

The major income for Google is Adwords and Content Network - Adsense, and who pay Google salary - Webmaster, e-commerce owner and affiliates...

Why would Google slap its' own income ?

I think what Google is trying to "clean up" fake review sites setup for pure affiliate commission without regards about the user...

If your website has content that helps the user, I don't think Google will slap you in anyway.

Think about it, if all result presented by Google is just pure affiliate review sites that doesn't serve the user, where do you think the user will go to seek answer?

Microsoft Bing!!

That's why Google must ensure its' result is useful and quality. Just add more useful content, such as testing figures or review guidelines, if you rate that product is Good, make sure you have evidence to support it!

Just contribute to Google search result, I am pretty sure it will stay.