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Adwords users have a beta option right now allowing them to site target you on a CPC basis. So if they are in the beta, and have site targeted you, and the clicks are not converting, then it could have a negative effect.
As mentioned in the above post, check your stats and see if you are earning an increase in site targeted revenue. If they are targeting you, and using the regular adwords method of CPM, then it isn't hurting you at all because you are getting paid per impression.
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