Firstly no one except Google has any idea of what a listing in the web directory DMOZ has on the ranking of websites in the search engine results. Many people like to believe that a web site listed in DMOZ is at an advantage over a site that is not listed. Others like to claim that this is not the case. Still others like to claim that it used to be the case, but it is not the case anymore. In reality they actually have no idea at all what Google does.
Those who believe that Google does give websites an extra ranking boost to a site that is listed in DMOZ like to argue that Google should not be doing this. They like to point to all the alleged corruption there is at DMOZ by editors listing their own sites and keeping out competitors (but then provide no evidence to back the claims); they like to point out how badly maintained some categories are (but ignore how well most categories are maintained). They also usually make all sorts of silly unsubstantiated claims (see Understanding DMOZ). There have been numerous attempts over the years by webmasters to petition Google to stop using DMOZ! They have fallen on deaf ears and have not convinced Google of anything.
What if Google does or does not give an extra ranking boost to a site listed in DMOZ? Does Google listen to all the, mostly, unsubstantiated claims made by webmasters about DMOZ or not?
Google does a lot of testing and that is what they listen to. I assume they have some server(s) set up somewhere where they test changes in the ranking algorithm before changes go live. How do they do these tests? We don’t really know, but they probably have some sort of scoring system for the overall quality of the search results for 1000’s of searches. The quality of the results will be graded by their pool of humans for this purpose. They then probably make a change to one or more aspects of the ranking algorithm, then they get the testers to rate the global quality of results for 1000’s of keywords.
So when it comes to DMOZ, I think we could assume that they have done some testing. They could have given a small amount, a medium amount, or a large amount, or no boost in the algorithm if a site is listed in DMOZ. They would have tested this on the overall quality of the search results for 1000’s of keywords. They would have worked out which amount of DMOZ weighting, if they even give any, in the ranking algorithm provides the searcher with the overall best search results across a broad spectrum of keywords.
It does not matter to Google if the claims made by webmasters about what they think of the quality of DMOZ; it does not matter to Google if your or my site is listed in DMOZ or not; it does not matter to Google if the corruption claims at DMOZ are true or not — what matters to Google is the effect on the overall quality of their search results if they do or do not give a boost to a website that is listed in DMOZ (or any other web directory, for that matter). It’s that simple. How do I know that this is probably what Google does? Check this thread at Google Groups Webmaster Help. Notice the post by SEO101 who said something similar to what I said above. Notice that a Google staff member marked that post as the ‘Best Answer’.
Added: Here is Matt Cutts from Google talking about DMOZ: