Local Keyword Research Help

I am looking to build local sites for my local business and my friends businesses. I am comfortable with wordpress, link building etc.

The one challenge is keyword research. I know if I get the keyword research wrong, I can be number one on page one and get no calls. All a huge waste of time.

I have spent the last few hours reading every thing I could find in the forum on local keywords research. Your real world experience and advice with local keyword research would be greatly appreciated.

Here is some of what I have come up with so far.

1-Use Adwords tool to get keywords and related keywords on a national scale. E.g. cosmetic Dentist. Then add local modifier to keyword. E.G. Seattle Cosmetic Dentist or Cosmetic Dentist Seattle. Don't care about search volume since keyword tools do not provide accurate information for localized keywords.

2-Use auto complete info from the search engines to see what people are searching for locally now. Don't bother about the search volume again, the results from the keyword tools are inaccurate.

Any additional clarifications on the above and what other methods are you using for local keyword research and most importantly which methods are working for you reliably without having to do too much trial and error. I am worried about building sites that rank easily but do not generate any calls.

Thanks for your responses.