help with duplicate content and geo-targeting issues

Hello,
Our client's competitor has recently started ranking number 2 on Google for a keyword that triggers more than 21 million other results. But as this competitor is not a big and well-known brand, currently ranks better than some established brands in the industry that have always ranked well, and is using some questionable techniques, we have some concerns, and we would be grateful if you could share your opinion about this situation.

Basically, the competitor has built a main site with a branded domain name and around 200-250 secondary websites, with the domain name formula 'keyword1-keyword2-location'. These secondary location targeted websites have very similar though not duplicate content (around 80-90% similar on average), and they differ significantly from the main website. A further issue with these secondary sites is that they all link individually to the main site. We assume, this must be why the main site is ranking so well, - even coming before big and established brands with consistent online presence. These secondary sites also rank well for their targeted keywords.

I would be grateful if anybody could share their opinion about these issues. Though Google's duplicate content policy is clear-cut, it is not absolutely clear what could be done in this case with the main site, and all the secondary websites.

So what do you think about:

1. Not exactly duplicate, but similar content issues

2. Building secondary websites for different locations (in this case, UK cities) with the sole aim of driving more search engine traffic but without enhanced user-experience.

3. Building links from different domains that nevertheless belong to the same company. Links, which could seem to be relevant inbound links to Google, but are only used to build page rank and domain authority of the main site, without any added advantage for the users.

4. These secondary sites could also be considered as doorway pages. Although they do not automatically or maliciously redirect the user to another site, they contain content only to gain higher places in search rankings and direct traffic to the main site.

5. Do you think these issues would be worth reporting to Google? This seems to be a rather complicated case

Thanks for your help.