Hi chandrika,
I too (like JKomp said), think we are probably safe. The amount of hidden text is very small but it is a concern when Google themselves spell it out so emphatically. There should really be exemptions for hidden text that is capable of being visible, like ours.
I have another somewhat experimental site (
www.appleproject.org.uk) which has hundreds of hidden words. Again I used show/hide layers extensively to enable me to pack lots of information into each page and reduce scrolling. The site scores very well for all it's main keywords and has done so for over three years. If Google have got a detector like the one at
http://tool.motoricerca.info/spam-detector/ it either doesn't work properly or is much more sophisticated. Let's hope the latter. I have seen Flash sites recently that blatantly use 'illegal' hidden text and still do well in Google. I read somewhere here that Google only bothers with individual cases of spam if it's reported.
There must be millions of sites with js/css menus which use the show/hide function and I've never heard of them suffering en masse. Perhaps the very existence of the 'show' function' counters the 'hide'?
Who knows?