Google Malware Warnings…boon or bane?

Google puts in advisories in search results to warn visitors that some sites may have been infected with malware. Search results will put in an advisory :”This site may harm your computer…” This has the effect of reducing traffic to offending sites down to zero. Users faced with such warnings will surf over to the next listed website in their search results.

Several things to consider from my limited experience with it.

Positive ones:
It helps us identify infections on hosted sites that we manage like and These two sites had been listed as being potentially harmful. We had to clean it up and do several virus scans to resolve this issue.

It had the effect also of reducing spams that were mysteriously coming out from these servers–after the servers were cleaned.

I read in local papers and on community forum that the same thing also happened to a university website in singapore that was headed by a CISSP Gary Teo. Their website got infected with malware and may have infected scores of students logging in to the school site. They issued an advisory as well.

Negative One:
Scary. According to official Google Glitch Advisory. Human error caused ALL sites to be listed as being harmful for about 40 minutes last January 31.
A “/” was included in the sites listed as malware. This meant the entire internet was now considered ‘harmful’.

So now it gets one thinking, is such malware advisory beneficial or not? What are the residual or collateral damage or undue influence are we letting Google do to our websites?