I'm in the UK too... with a wife and kids. I've been making money online since 1997, and this current moment in time is frikken rough. Seriously.
Having said that, there's still money to be made. It's just harder than before.
Here's my suggestion. Sign up with affiliate networks...
His Analytics show 94% of traffic from search engines, Nov through Feb, so unless he was paying people to find and click his listings in Google, it's not paid traffic.
... but his CTR seems too high to be natural... 108 clicks from 271 page impressions? Right.
Your brand new site is getting a "honeymoon bonus" for new content as well as strong bonus from the exact domain match. Double bonus = better rankings. But what will happen when the honeymoon expires?
If your client's sites are all in unrelated niches it would look very dodgy to link them up. If they're in similar niches but on the same ip or with the same registrar, it would look like you're creating your own mininet. I wouldn't do it.
Isn't Webmaster Tools a few days behind? Perhaps they don't know you've been canned yet. Either that or Google's penalty filter doesn't report to Webmaster Tools.
What's likely? Google looks for natural, ongoing link growth AND natural, ongoing content growth.
If you change the speed of either during a "dance/sandbox/penalty" you could raise a flag.
Keep doing content+links.
pagerank is about pages. What pagerank is the page you want to beat?
I guess it's not their homepage... in which case it probably wouldn't be too hard, but the quality of their external links to the page would be key.
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