Hi HGV
It sounds like a very similar program to other schemes such as linkmarket and linkalizer etc. You're right - it isn't just a purely automated scheme - but in terms of search engine rankings it's almost useless (certainly on Google).
The problem is that everyone in such schemes ends up with a page with hundreds of useless links that don't really add much value to the customer. People selling Spanish property often think "Great - I'll link to a site selling property in France" or "I can link to a Spanish recipe site." When the reciprocal link comes in, they end up on a page of categorised links that looks exactly the same as a thousand other pages on the internet. Such a page has no content, and the links have no context. Therefore it doesn't offer much to a visitor and Google doesn't give it much credence.
And if a site has 200 incoming links and 200 outgoing links to those same sites, then Google just says: "Ah - a link exchange program... if this site can't get links in any other way then it can't be very good."
At best, it has no effect on your rankings in Google. At worst, it can mark your site down as being slightly dubious - especially given the vast number of low-value sites that tend to be such schemes.
IMO, of course...