Duplicate content is the same page contents, on multiple pages, within one site.
Using PLR is does not create duplicate content when used on different sites. When two sites have the same content is is called Syndicated content. Google will try to figure out the authoritative author (original source of the material when it appeared online) in the case of syndicated content, and rank subsequent publishers lower than the original article.
Google will rank this syndicated content by it's quality and by the authority of the site presenting the syndicated content, and whether any of the syndicated content is credited to the original source.
In other words, suppose you write an article, and it is really good. So good that I steal it and use it as is or spin it so poorly that it is still recognizable and use it.
My site displaying your content will not get a hit for duplicate content. It would be ranked lower than your site, because the original source (your site) will be assigned higher authority for that article.
Always remember that Google seldom punishes natural behavior. It is natural for content to be shared and duplicated on the web. This is in a nutshell what DARPA had in mind when the Internet was conceived.
If there truly were a duplicate content penalty, you would only find one copy of anything on the internet, every other example of the duplicated material would be de-indexed.
What happens instead it is that if the article has been widely used, the uses of that article before you use it has used the authority to be gained by posting it again. In other words there are so many people ahead of you, you don't count.
You can test this yourself. Go to Harvard law school (or any authoritative site) and download a some of their original content to put on your web page.
When your web page gets indexed, if there is such a thing as a duplicate content penalty, your page would not get indexed, or it would get indexed and then fall out of the index, and your site would take a ranking hit.
This is not what happens at all. More than likely your site would tool along and notice no difference in rankings, but your page would never outrank Harvard's page.
If you were to quote this content as quoted content and link to Harvard as the source, your site would likely rise in rank because of the outgoing link that points to the original source. Google would grant your site a tad bit more authority because you are behaving in a way that is natural on the web. You should always credit your sources. It gives you credibility.
This is why savvy marketers use PLR as inspiration, and rewrite the article until it passes copy scape. This is why everyone tells you to re-write PLR.
If you want to see a duplicate content penalty put up a page with content on it and advertise a product on that page. Wait for it to show up in the index, then build another page with the same content, and advertise another product on it. Rinse and repeat, and one day very soon, your site will disappear even when searched for by domain name.
When someone searches for any article the sites that display that exact content will rank in order of their own authority without regard to the fact they have the same content as each other. Usually the original poster will be on the first page, but he were a relative unknown on the web, the sites that syndicated his information first may be higher up in the serps, if their authority matches the authority of the other syndicators.
What a lot of people are calling a duplicate content penalty is in fact a poor quality article penalty.
