Here is another thread from the DealerRefresh archive that may be worth a skimming too. We discussed this at length in Nov of 2011:
http://forum.dealerrefresh.com/f43/dealers-flooding-review-sites-fake-user-reviews-1879-5.html
I agree that there is a difference between a review and a testimonial that is more than simple semantics. Reviews are Earned; Testimonials are Owned. You are talking about the consumer confidence disparity between earned vs owned media that transcends automotive. All marketers are dealing with these topics right now.
Owned media (think paid adverts on radio, TV, and Newspaper, Infomercials for OxyClean etc.) will always be challenged to have the same credibility to the consumer as Earned media (think traditional word of mouth, watercooler endorsements from coworkers, and advice from Grandma.) It is no doubt easier to control the message of Owned media because you OWN it. You either paid for it or you have complete editorial privilege over the content... and the consumer KNOWS this. With Earned media you may not get the exact branding message or the perfect image you desire, but the positive sentiments are 100% genuine because they aren't compensated by anything but altruism... and the consumer KNOWS that too.
Unfortunately, the perceived "brain damage" that comes from not having control of the content is likely what makes the content valuable to the consumer.
My opinion is that you need both to satisfy the consumer's current desire to virtually poll their peers. There is nothing wrong with having a testimonial feed or site with your owned media so long as you disclose that it is a highlight reel of sorts, but you shouldn't expect that to satisfy the consumer's desire for earned media, and for that they will likely be researching reviews on 3rd party sites. That said, I would not try to pass owned media for earned media.