Since the introduction of the nofollow attribute there has been a lot of confusion in regard to it’s actual meaning in the webmaster community. Does it mean the SE will stop at any link using the attribute, and go no further? Does it mean the SE will follow the link, but not hold the site posting the link accountable if the recipient of the link is a bad neighborhood? I think you can see some of the confusion in this Wikipedia explanation of the nofollow attribute. Unfortunately, IMHO the SEs were not clear about the meaning of the attribute in the beginning.
To add to the confusion, Google has been suggesting the use of nofollow in places other than blogs, or guestbooks where people or bots can post unedited links. Matt Cutts of Google is suggesting that the nofollow attribute be used on all paid advertising links. Yahoo shows links that use the nofollow attribute as backlinks.
Vanessa Fox of Webmaster Central recently made a comment in regard to how Google is dealing with nofollow.
Avoid infinite crawls. For instance, if your site has an infinite calendar, add a nofollow attribute to links to dynamically-created future calendar pages. Each search engine may interpret the nofollow attribute differently, so check with the help documentation for each. Alternatively, you could use the nofollow meta tag to ensure that search engine spiders don’t crawl any outgoing links on a page, or use robots.txt to prevent search engines from crawling URLs that can lead to infinite loops.
Notice she points out that each SE might handle the attribute differently. No doubt because IMHO there was no absolute definition of the attribute given when it was introduced. In addition Matt Cutts of Google has suggested other uses of the attribute than what it was originally intended for. Which was to cut down on spam where a contributor (spider) could post links without the intervention of an editor.
If I understand what Vanessa, and Adam are saying Googlebot stops cold when it encounters a nofollow attribute. Googlebot will not follow the link.
Thanks to the new tool added at Webmaster Central for seeing all internal links, I can check this out on Condells.com. Google is showing some backlinks from my shopping cart. The robots.txt file disallows the folder the shopping cart is in. Googlebot appears to be following the view cart link, and then the continue shopping link back to the page the view cart link is on. Does that make sense.
Based on what Adam, and Vanessa have stated I have added nofollow to the view cart link. So I should see those internal links start disappearing.
Here is an interesting article by Loren Baker at Search Engine News giving 13 reasons why NOFollow sucks.
My suggestion. All SEs make nofollow mean exactly that. Google says they are exactly that at this time. To bad Google has waited for a year to make any kind of statement on how they are handling the attribute. It would have stopped a lot of confusion IMHO.
i guess better late than never.