I think the problem is most brands don't pay for sponsored content to "have a good article written about them". They pay to push an agenda. They are completely different things, but at the end of the day the paying party is expecting a positive result on their investment.
This is bending the public perceptions on a subject in a subtler, but still pernicious, way.
Absolutely. I've seen this first hand, my experience being very similar to PGs: I had no idea how pervasive PR networks can be, until I realized that marketing teams could regularly push 'coverage' of a product release in 50+ blogs on launch day, no biggie. Self-respecting blogs, say Engadget, will only take a few takeaways from the press release and publish them as quoted text. Most blogs won't even bother, just publishing the press release verbatim.
The easiest way to distinguish such coverage is to find a particularly unlikely phrase in one of the articles and Google for it. If you find a bunch of other articles with the same or very close wording, you know that you are looking at a press release. Try it!
This is bending the public perceptions on a subject in a subtler, but still pernicious, way.