You could create a national site, but have specific sections for each state or region. The tricky part of this is to make each region's sub-pages unique. In other words, don't simply "madlib spam," which means to substitute the city name, but keep th rest of the content the same.
[Offtopic]Mustard, I see you are in the Boston area. You may be interested in joining our SEMNE (Search Engine Marketing New England) organization.
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