As far as I am aware, we have not had any form of bots on any of our servers, and I haven't heard about it on others. Are you sure it wasn't just people using x-ray mods or texture packs?

It certainly is an interesting idea if that works.

I suppose the only way to deal with cheating bots would be to ban the accounts that you can confirm are bots. Or any users that you find out are cheating.

I know there are a few plugins out there that check for people mining certain blocks too fast, such as diamonds and emeralds, you could use one of these to discourage people from using it at least.

Or maybe you could work some kind of captcha like idea into minecraft, a test that a user has to pass before they can dig/build.

Internet bots, also known as web robots, WWW robots or simply bots, are software applications that run automated tasks over the Internet. Typically, bots perform tasks that are both simple and structurally repetitive, at a much higher rate than would be possible for a human alone. The largest use of bots is in web spidering, in which an automated script fetches, analyzes and files information from web servers. Bots may also be implemented where a response speed faster than that of humans is required (e.g., video gaming bots and auction-site robots) or less commonly in situations where the emulation of human activity is required, for example chat bots. Recently bots have been used for search advertising, such as Google AdSense.