The search term I am looking for gets fewer than 60 people a day, however it is in a highly competitive general category. So say my keyword was Red Apple Lawyer. Would I get sent to the sandbox for the lawyer being in the keyword? If so, is it better to just create the website from an existing blogspot account?
lawyer is a highly competitive keyword, but "red apple lawyer" is not (comparatively). In any case, getting a domain is always far better than doing all the work for this blogspot accounts. You are giving boost to somebody's else site and not yours.. So technically, your time is invested for no good benefit of your own . Get a domain and start working on it...