Below is code for a filter to apply rel="nofollow" to all links (eg for node bodies and user added blocks).

/*
 * Provide a filter to apply rel="nofollow" to all links.
 */
function nofollow_filter($op, $delta = 0, $format = -1, $text = '') {
  if ($op == 'list') {
    return array(
      0 => t('Nofollow'));
  }
  switch ($op) {
    case 'description':
      return t('Applies the rel="nofollow" attribute to all link tags.');  
    case 'prepare':
      return $text;
    case 'process':
      return str_replace('<a', '<a rel="nofollow"', $text);
    case 'settings':
      return null;
  }
}