Mirroring Websites by Giving Affiliates Subdomains
Answer: Giving affiliates the same set of data is indeed a duplicate content nightmare, and it makes it hard for the affiliates to push their sites into the core organic parts of the web. If they have a product database and the same reviews and content that exist as the core branded site there is nothing remarkable about what they are doing. You can look back to this post on leaked human review documents to see how Google views affiliate sites.
Instead of cloning all your content and giving affiliates access to that, I recommend encouraging affiliates write personal journals on their own subdomain. I would encourage them to promote your products and blog about topics other than your products. This will allow some of them to work their sites into the organic parts of the web while encouraging them to write content interesting enough for people to want to subscribe to it. Sure some of the affiliates will not get much traction, but enough of them try it a few will, and they will boost your brand whenever people visit their sites.
You can include a bunch of WordPress themes and extensions with their blogs, create a free guide to blogging, create an affiliate directory, and other offers that make it easy to get affiliates into sharing information. Maybe even install a Vbulletin forum and write a blog just for your affiliates. Bonuses to further entice a sense of community might be highlighting daily or monthly top posts, offering free design services to top affiliates, giving away prizes like link building, and interviewing some of your better affiliates in a monthly community newsletter.
Creating a platform for sharing passion is a much better affiliate strategy than duplicating content is.