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All links consume link juice even nofollow links.
What happens to the link juice is the question, does href="#" just flow back to the same page, first thoughts are yes, but then if that is the case, you would be able to manipulate how much link juice flows out of other links but adding more. so I think they may waste link juice. JavaScript links use link juice and there is no guarantee that Google is able to pass that link juice on.

A lot of CMS use this type of links href="#" on a A tag then use the A tag for some other reason, such as a button to fire JavaScript. I believe that if you want a button use a button, if you want a JavaScript link then attach the event to a SPAN or DIV, use A tags only for real links and be sure you know what is happening to your link juice.

I would agree with you. You have to ask yourself why do we have a blog. i find many people have one but dont know how or if it is helping them. Why have one on a different domain? To give links to your main site? Then why reciprocal link back to it? If your blog can attract a handfull of links under the same domain, it would out-weigh any links from your own blog on a seperate domain. (hope that makes sense)

I think having the blog in a subfolder or subdomain is the best use, you stand to gain links and traffic and you can use these pages to funnel PR to your home and landing pages, see link
http://thatsit.com.au/seo/tutorials/a-simple-explanation-of-pagerank

As others have stated, its a bit in your face to the user.

May i suggest rather then a pop-up, just insert it somewhere un-obtrusive, after a few seconds, a simple bit of movement is all that is needed, and it would not stop the user from reading your content