Personally, I bought my earlier properties through the Investors Club, and they have done pretty well. ANY property would have done well in the last 7 years, but the key is that if I hadn't bought through them, I probably wouldn't have bought anything. I stopped dealing with them after 2003 because the properties on their list just didn't appeal to me anymore (low yields) and I was moving towards houses.
The difference between them and a 2 tier marketing company is that, as far as my research has shown on the properties I saw, the prices they advertise are around market price. At least it's not massively inflated like you see with some dodgy marketing companies.
For my first one, the first thing I asked the guy who showed me the property after we saw it was to take me to a few local agents so that I could compare prices. He did, and the prices were comparable (i.e. they weren't loading up the price just because I was from interstate). A 2 tier scam company would never do that because it would expose them.
However, that is not to say all their properties are good. In 2003 I bought one from them where the valuation came in at 10% below the purchase price. I had the option to pull out but I went ahead. Returns have been flat for almost 3 years (but then my next property was in Perth that returned 100% in 3 years). It's about averaging. If I hadn't bought that Brisbane one at the peak, I would have broken my momentum and wouldn't have bought the Perth one.
Treat them as what they are: agents who also teach you the basics of property investment. Go to the meetings to learn: you don't have to buy anything if you don't want to. I knew nothing about IPs before going to the IC meetings, and they started me on the road. However, now that I have a little bit of experience, I don't need as much hand-holding and I can do it myself.
They ARE big on negative gearing, mainly because their business model depends on new developments. Sourcing older properties wouldn't be cost-effective, presumably.
Could I have done better without them? If I knew then what I know now, yes. But I knew nothing about IPs then. Would I have started buying IPs if I hadn't gone to their meetings? Who knows.
Alex