I posted this as a response to a different question, but some of what I said may be relevant here...
Domestication of ruminants is actually not necessary to procure dairy, it simply allows dairy to be predictably available. The Comanche tribe regularly slaughtered lactating buffalo cows, cutting out the milk bag and drinking it warm, mixed with blood. They also would kill suckling calves and cut out the curdled milk from their stomachs (rennet, used in modern cheese making, is still sourced from calves stomachs) as it was a sort of cheese. (Read more in "Primal Living on the American Plains")
While they are not hunter-gatherers in the "paleolithic" mold, the semi-nomadic Maasai did quite well living off of a milk, meat, and blood based diet. From what I've seen, however, they did include certain roots/herbs that may have offset the cholesterol-raising effects of such foods. (read more about milk in traditional diets here)
I definitely agree that most diary farms are "not Paleo". While some farmers treat their cows humanely, give them regular access to pasture, etc. many others are content to simply stamp a picture of such bucolic images on their milk carton.
The regulations governing labels such as "organic", "Free range", and now even "pastured" or "pasture-raised" are constantly under attack by Big Food. The main industry players are only interested in "shareholder value" and as such, shortcuts, deceptions, and half-truths are inevitable. The letter of the law may be followed, but the spirit is not.
Full disclosure: When given the choice of neolithic foodstuffs, I personally lean towards partial inclusion of dairy products, sourced as best as I can, and of the fermented and high-fat ilk.