During the police operation, 18 people were arrested in Bay of Plenty, Auckland and Wellington.
Four of those arrested, including Tuhoe stalwart Tame Iti, were the only people left facing charges in connection with the raids.
The police sought charges under the Terrorism Act after filming weapons training in the Urewera Ranges but were left with the firearms charges after the courts ruled evidence to be inadmissible.
IPCA chairman Sir David Carruthers said the nature of complaints received by the authority ranged from the impact on the community of armed AOS officers at a road block to feelings of ill-treatment by police during the execution of search warrants at properties.
Sir David said the then Commissioner of Police Howard Broad was justified in undertaking the operation in Ruatoki valley and elsewhere.
However, he said the road blocks established by police at Ruatoki and Taneatua were unlawful, unjustified and unreasonable.
"While police were warranted in taking steps to address possible risks to public safety there was no justification for believing there was a general threat to the people of Ruatoki."
Police had no legal status for stopping and searching vehicles or photographing drivers or passengers, he said.
Sixty-six photographs were taken of drivers and 15 passengers, including in some instances, children.
That left some people feeling "degraded and intimidated", Sir David said.
The report also found that police planning and preparation for the establishment of the roadblocks was deficient.
"The road block at Ruatoki and the presence of armed police officers was intimidating and the report states that there was no assessment of the likely impact of this activity on the local community," Sir David said.
The report also showed that the detention of the occupants at five properties examined by the authority was unlawful and unreasonable.
"While Police have the power to restrict the movement of people to prevent a search being interfered with, they cannot lead people to reasonably believe they are being detained. In a number of cases here they did so."
In addition, the authority found that personal searches conducted by police on a number of occupants were unlawful.
"No shots were fired by police or others, all arrests occurred without incident and no members of the public were put at risk," Sir David said.
The authority made a number of recommendations to police following its investigation, including changes to policy and practice relating to the use of road blocks, as well better planning for children and vulnerable people.
"The authority recommends that police re-engage with Tuhoe and take appropriate steps to build bridges with the Ruatoki community," Sir David said.
He refused to answer any questions after the press conference, saying the report was so thorough, it spoke for itself.
The authority has been delayed in releasing their report into Operation Eight because of ongoing court proceedings.
Police say they have accepted the findings of the IPCA's report on Operation Eight, and have already made significant changes to address many of the issues canvassed in it.
Commissioner Peter Marshall he accepted the authority's commentary in relation to the Ruatoki and Taneatua roadblocks and five of the 41 property searches, and acknowledges that police underestimated the focus on Ruatoki and Tuhoe that subsequently emerged.
"The context is important here. This was an operation involving more than 300 police staff nationwide.
"It followed an almost two-year investigation into a group of people involved in military style training camps using Molotov cocktails, semi-automatic rifles, threats to kill people and destroy property," he said.
Mr Marshall said police discovered numerous weapons, and bringing the activities to a close was potentially very dangerous and police officers exercised an "abundance of caution".
"However the IPCA has identified some instances where staff invoked statutory powers to carry out their actions, which were later found not to meet the legal threshold. In other instances, staff exceeded their authority or didn't interpret the legislation correctly," he said.
"I apologise for those instances where Police failed to meet expected standards when carrying out the Ruatoki and Taneatua roadblocks and five of the 41 property searches."
Police have made many changes to operational policies and practices since 2007 - the most significant followed the passage of the Search and Surveillance Act 2012.
This codified and clarified the law in relation to the way police carry out surveillance, enter places and vehicles, conduct vehicle stops and search and secure people, places and vehicles.
Police Minister Anne Tolley has welcomed the release of the report into Operation Eight.
"I am pleased that the IPCA has found that the Police decision to take action in 2007 was justified.
"The vast majority of fair-minded New Zealanders will back the police to act when they believe public safety is at risk."
Police had already accepted they acted unlawfully in terms of road blocks, detaining occupants of five properties, stopping and searching vehicles and taking photographs, Ms Tolley said.
"The police have accepted this and have apologised.
"I have discussed the report with the Commissioner and I have been assured that the police have learned valuable lessons from these events, and have made significant changes in the almost six years since the operation.
"I will be keeping close watch to ensure that the police continue to act on areas for improvement, especially around rebuilding relationships.
"It must be remembered that four people were convicted as a result of the police actions, and that no one was hurt in any of the operations.
"When people are running around with guns and Molotov cocktails the public would expect police to take action, and will back them to do so in the future," Ms Tolley said.
Green Party police spokesman Dave Clendon said the report showed a dramatic overhaul of police culture was urgently needed.
"Police broke the law and rode roughshod over the rights of Ruatoki people. I expect police to apologise, that's the bare minimum, but it's not enough and a real cultural change is needed.''
Mr Clendon said he had serious concerns that racial discrimination had played a part in the raid.
"Would the police have raided Remuera in Auckland, or Khandallah in Wellington in the same way? Little children left home alone while carers were dragged away by masked men?'' he said.
• Re-engage with Tuhoe;
• Maintain a decision log during the planning of major operations;
• Amend AOS policy on Nomex hoods;
• Require police generally to undertake a Community Impact Assessment for all operations with a potential for significant adverse impact.
• Amend the policy on planning for children and vulnerable people when executing search warrants;
• Clarify the policy in respect of photographs at road blocks; and
• Amendments and clarification of policy reflected in police training.
