Re "Kevin the Teenager" - I don't believe the entire saga can be distilled into a single pure negative emotion. I think it was more complicated than that. For instance, I could have redacted any inconvenient fact I liked by quietly surrounding it in search terms with contradicting fakes, then repeatedly requesting the 'injurious & wrong' fact be removed until some overworked peon did so. Wikitruth.
Re "Pure bollocks of the highest order", a computer algorithm is a collection of frozen human thoughts - you can argue they are "decided by a human", and not, at the same time. The crux is the algorithm can only operate on information a computer has: A human can spot a cat video. A computer can spot the RGB pixel values and MPEG deltas of a video. A human cannot spot how to spot a cat from RGB values and MPEG deltas of a video. Declaring they secretly can, doesn't make it true.
Re "they're a publisher". They *still* didn't create the promoted story. An algorithm still chose what results were most relevant to that user, and put them in an order, which is also the description of Search. Shouldn't Search then to be human-moderated?
Getting them declared a publisher doesn't make option (1) or (2) go away. But what use is a global 24/7 computer search engine where Humans have to make all the ultimate decisions for legal reasons? How would you customise that on a per-user basis?
Ultimately, if you can sink Google with publisher-responsibility automated sueballs, and I get the impression you want to, you WILL sink EVERYONE else obeying the same laws too.
In other words, you just forced the search engine space into the hands of only the people your laws can't touch. Are you sure you've thought this all the way through?
Also, if you need humans to take responsibility for fake news in influential channels, on pain of pain, WTF is up with Fox News? I think I prefer the algorithm - less evil than humans.