I believe a lot of people around the IM Community like to stress on the act of taking action, which is fine, but only if you FIRST know what you're doing. This is an education-based business, and if you don't educate yourself first on how X-
SEO Service can affect you, both positively and negatively, then don't take action until you first know what the heck you're getting into. Make sense? Sorry for the tough love, but that's just what it is. As Stufferizer, twilightofidols, and a few others previously stated, this is a tough lesson learned. Keep your head up, and begin a new project.
Right now, you're at a pivotal point in your IM Career, where many people would simply give up. Is that the path you want to take? We cannot answer that for you. Do what you feel you need to do, but trying to reverse a decision Google makes, is a near-impossibility for even the most advanced social-engineers, so my advice to you would be to forget about the old project, start something new, and EDUCATE YOURSELF, before engaging in any blackhat ANYTHING. Fair enough? Actually, I wouldn't even start doing anything whitehat. Spend some time educating yourself. You need it. We all need it. There's no getting around it, unless you have deep pockets.
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