Let's take a step back... NO BACKLINK CAN HURT YOUR SITE... yes, think about it... if it did, would people not keep adding those backlinks to competitor's sites???
I do not use it for monetary purposes but I love squidoo... it's so colorful and exciting with the lenses etc... apparently a lot of people are using it for making money as they have modules for ebay amazon etc in the lenses...
Not trying to hijack the thread, and surely not trying to sound stupid, but when you have "Keyword1 Keyword2" as your anchor in your backlinks; it does help with not only the two keywords combined but also with the individual keywords, right? So you actually have some support on the one keyword...
Why do you think "keyword location" is not very content friendly? On the contrary, if this is a local company, you must focus on the location... for example, the site title can be "location keyword; for all your keyword needs in location"... just an example...
Get them on google places, yelp...
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