If the Conservatives do go negative, then the question becomes- how should the Liberals respond? Speculation, if the Conservative run ads, the Liberals will respond with ads of their own. No matter the financial circumstance, response ads are a necessity. A modest "buy" would be enough, because the free coverage and digestion after the fact would validate any expenditure and further the frame that the Liberals will no longer be bullied.
The only danger, with any response, the possible perception of a tit for tat pissing match between the two principle parties. People really wouldn't care who "started it" necessarily, so the Liberals would be wise to fashion a classy response, that strikes a tone of non-partisanship. I'm thinking the best response is to actually use the Conservative attack and shove it right back in their faces.
Just a thought, but something like a television in the background playing the Conservative attack ad, then start plastering newspaper headlines over the screen, with titles that speak to the dire economic data. The entire screen covered, then simply a question about leadership and priorities, asking Canadians if these attacks are what they expect from their government during an economic crisis.
That sort of response doesn't place the Liberals in the mud with the Conservatives. In fact it exposes their own obnoxious distractions, it actually mocks the source. The substance of any attack ad is secondary to attacking in the first place, you neuter the frame, while simultaneously appearing above the fray, almost a tsk tsk feel. I think any response by the Liberals should incorporate the attack ad, and make it more about the messenger, than the message. Then, when Canadians see or hear the Conservative campaign against Ignatieff, they are reminded of playing partisan games while the economy is crumbling. Hardly a net positive for the Conservatives, and you show the distinction.