Including category names in product urls isn't detrimental necessarily, but it lowers the keyword density of the url and relevance to the actual product page which isn't beneficial.
http://seobraintrust.com/ has great resources for learning SEO.
http://highrankings.com/ has always provided good SEO.
Conor's wife (Hands On Web Hosting) is now doing SEO and while I haven't experienced any of her work first hand she does seem to have a solid understanding of real SEO.
http://www.bigredseo.com/
Of course don't forget about our SEO review as mentioned in my signature
http://www.websitecm.com/seo/seo-website-review.html