According to Google engineer Matt Cutts, PR sculpting using the nofollow attribute was changed more than 2 years ago. Any attempt to use the nofollow attribute for sculpting PR would have a negative effect on your own website rather than a positive one.
Sadly, nearly every ebook on the topic has given bad information since they were all published after the algorithm was changed. If you place the nofollow attribute on your internal links you are simply bleeding off PR needlessly. The only way to achieve effective PR sculpting is by restricting your linking to a small number of pages, not by using the nofollow attribute.
Source: PageRank sculpting
I don’t believe Google is in the business of “punishing” people when it comes to SERP. It’s more like they aren’t willing to reward bad behavior. It appeared to me that the reason they changed how Pagerank flowed was to remove the incentive for PR sculpting since it was corrupting the intended flow of PageRank.