Here's the definition direct from Google: Link cloaking is a method used to make a long affiliate URL link into a shorter and prettier one—often to the detriment of a brand. The first URL clearly identifies the merchant, whereas the second is simply a shorter URL seen more frequently as more and more people use link shortening services.
The way I understand it, cloaking links is a way to avoid a search engine penalty. If that's the case it would seem fine with Google. If I am wrong about that hopefully someone will chime in