My take,
First, we distinguish between two related yet distinct concepts: "fair use" and plagiarism. And please note, this is more or less a work in progress. But as the stated purpose of this blog is "writing to write," I did not feel this off-topic so to speak.
FAIR USE
"Fair Use" is using another's copyrighted material "for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright." I cite USC Title 17, Chapter 1, Section 107, (and yes Uncle Sam, I do consider my citation "fair use"). "Fair Use" is not an excuse for not citing a source. Arguably, it may be "fair use" and still constitute plagiarism.
PLAGIARISM
Plagiarism is "the use of another's work, words, or ideas without attribution." I quote directly from the definition of plagiarism provided by Yale University's writing center. However, the actual definition itself falls within the area of "common knowledge." In addition, "common knowledge" is most definitely one of the gray areas. Mind you, whether the use of "common knowledge" constitutes plagiarism is not a gray area (you may use "common knowledge" without citation to a source). It is how we define "common knowledge" that makes us squeamish.
COMMON KNOWLEDGE
If you type "plagiarism" and "common knowledge" into any Internet search engine, you will find a myriad explanations and definitions. I use the one provided by Yale, because I happen to be at that web site:
"The "common" way to talk about common knowledge is to say that it is knowledge that most educated people know or can find out easily in an encyclopedia or dictionary. Thus, you might not know the date of the most recent meeting of the Federal Reserve, but you can find it out quite easily. Further, the term "common knowledge" carries the sense of "communal" knowledge-it is community information that no particular individual can fairly claim to own. One sign that something is community knowledge is that it is stated in 5 or more sources. So, if it's known to educated people, or can be easily looked up, or appears in many sources, it is likely to be "common knowledge" and so does not need to be cited."
The link is,
(http://www.yale.edu/bass/writing/sources/plagiari sm/common.html)
I think that I have seen "rule of thumb" that if it appears in three separate sources, it is likely "common knowledge." In the Air Force (where I learned to write), they taught me the rule of five, but in either case, we get the concept. It can be tricky. For example, certain "facts" appear all over the Internet. I have one in mind right now, a certain statistical argument about religion and prison. You will find, however, that all such references trace back to a particular statistical compilation. It is not truly "common knowledge," people just cite it everywhere. By the way, what is "common knowledge" is generally an expanding body of knowledge, not a contracting one.
FAIR PARAPHRASE
Finally, we have the amalgamation of the two concepts. "Fair paraphrase" and this falls very much into that dim, dark twilight colored issue referred above (oh damn it, I mean "gray area" again, I got bored and was engaging in very bad, elegant variation). You take some part of another writer's ideas, you do not need them all, and you reword it into your own voice and your own ideas. If you do not change the essential form or content, if you quote long passages verbatim, it is not fair paraphrase, it is "elegant plagiarism." This is really an area where, if in doubt, cite your source.
CITATION FORM
Most news organizations, scholastic organizations, journals, professions, they each have their own unique citation form. Two rules of citation might be (1) ensure your reader can find your source; (2) use a uniform citation style. Finally, if the uniform citation style proves inadequate for a particular source (say you want to compile "railroad ball bearing receipts" from a Mahwah, New Jersey lead plant) refer back to rule (1) and help your reader find your source (e.g., see Mahwah, NJ, Railroad Bearing Receipts for 1950-1953, Copies in Author's Possession). In the case of an Internet link, the address is likely enough. Links die and get broken, so it might be appropriate to give more information.
Because in any group of fifty-one writers, we will likely have fifty points of view (I can almost always win one person over to my point of view), we need the procurer of our works to hammer out a set of guidelines.
SOURCES
Yale University, The Writing Center, Principles,
(http://www.yale.edu/bass/writing/sources/kinds/p rinciples/)
US Code Collection (I used Cornell's collection for convenience),
(http://www4.law.cornell.edu/uscode/html/uscode17/usc_sec_17_00000107----000-.html)