Thank you all for good advice.
You bring up a good point about the in-bound links. Somebody could sabatoge their competition if they wanted to if Google penalized you just because you had a large influx of links coming in.
We were not dropped completely. We still rank well for many terms, we just went down a little in some, and more in others.
I'm not dismissing the other factors, I just tend to think due to the timing that it must be one of those factors I mentioned. I'm now more inclined to lean toward the paid directly links.
We are too busy to handle SEO in-house anymore.
Does anybody have any recommendations for a good SEO firm?