Indeed; political campaigning 101 (at least here in the UK) is that libel must both:
* contain false statements AND
* be designed to damage reputation.
If only the latter, then it's not libel.
However, if it's the former as well, then both the author and the publisher/printer can be sued, so DO in this case are protecting their own legal status by removing libelous material.
Saying you don't like someone online, quoting them and making inferences, are all part of normal political debate and are not libelous.
Quoting somebody out of context, or changing the quote, and implying that they believe the direct opposite of what they actually said, would be untrue and therefore would be libelous. True quotes, backed up by screenshots, would not fall into this category, at least in the UK.
Exactly. If it was libellous, then DO do need to protect themselves. However I felt that blog post was genuine, on first impression of reading it, and I think there was enough evidence that it may actually be true that DO should not have been anywhere near as quick to take it down, perhaps they should have investigated it more.
That is, if the reason for taking it down was entirely to protect themselves legally. From what I've read, it's hinted that this might not be to protect themselves, but might be more down to them just wanting it gone.
In the U.S., there is the concept of "false light", which is similar to defamation, except that the plaintiff can claim damages even if the implication is true.
A classic case (though for some reason, I haven't been able to find it through Googling), according to my law professor, involved Time LIFE Magazine (or perhaps one of its peers), which had a photograph of a cowboy, and the silhouette, perhaps it was the back of his saddle, appeared to imply that the man was exposing his member.
The photo was unaltered and thus, true, but the cowboy was able to claim damages. Again, I'm citing from memory but haven't been able to find the case via web searches (it's likely to have happened decades ago, though).
Since the U.S. is more permissive on the issue of libel than most countries, I imagine the concept of "false light", or something similar to it, exists in most countries.
The original blog post strikes me as possibly slightly biased, but probably true, therefore not libellous.