There's a slightly bizarre situation here where search algorithms are working against themselves, yeah. Presumably anything spiked by PhotoDNA isn't returned at all - which frees up those spots for the next-most-relevant result. And the more effective Bing's indexing is, well, the worse that result will be...
Since PhotoDNA is basically a known-bad tool, it presumably can't win the battle unless turnover is fairly low. Penalizing or hiding sites with many PhotoDNA hits (or perhaps a high percentage of hits) might do better by targeting concentrators, but that would depend on what sort of sites are serving this stuff. I assume they have to be fairly small/scattered to stay operational, which in turn makes it harder to predict what sort of content they have.
(And despite the article, it doesn't seem clear that Google has solved this problem, so much as bypassed it with a whitelist approach to nudity in general.)
