Not long ago, I saw this Wikipedia article referencing a post on Hinduism.SE:
Now imagine some new user posting that text that as an answer here. We end up in the same circular-reference problem you are talking about.
I'm seeing that a lot of new users are quoting Wikipedia, blogs and what not. In fact some of the high-rep users are still continuing to do so.
It looks like the rule the moderators here have adopted is:
Anything goes, as long as one uses blockquotes and leaves a link to the source in the answer. It's fine with us even if the reference is to a verse from Bible or Quran to prove one's point.
Also, with the current rules one can write his or her opinions in a blog, quote his own words using blockquotes here in the answer and the answer is now no longer an opinion because it has a proper reference!
But write the same opinion without blockquotes or any references and it's guaranteed to be taken down.
What a flawed system!
I don't think flagging answers is doing any good because moderators and several users who monitor the review queues are very lenient when it comes to enforcing the same rules they have upvoted here on meta.
This is what I got back from a moderator when I flagged an answer that didn't have any references at all:
no references, needs a banner – sv. Sep 6 at 3:40
declined - flags should only be used to make moderators aware of content that requires their intervention
As I stated here before on another post, moderators themselves are not clear on what rules they should be enforcing.
So I suggest everyone to read this excellent post and start using your voting power and downvote answers that you don't think meet the reference criteria.