no mercy - submit your site submit the rival URLS TOO! bad directory can harm - just take a look at a link they offer - see the source - check for nofollow or other attributes ... check if the links are active ... search for this directory and you can estimate if it is good or bad. The reality is that directories offer a constant backlinks - and it is much easier for a web spider to crawl and index a directory than to roam the sea of websites and search for links - evaluate them and index...
Do you really think Google hasn't taken into account the scenario of businesses submitting rival's businesses to bad neighbourhoods.
Directories are the basic source of website promotion and the easy way to get one way link so they are not evil if used in proper way.