Consider a subdomain as a seperate website. You can have multiple subdomains as long as they have unique content. For example one subdomain can focus on selling widgets and another subdomain can deal with repairing widgets. This will avoid the chance of being seen as spam.
What if I build a sub-domain to group products other wise scattered throughout my domain? As a example: I build a sub-domain "red.foo.com" and populate it with html pages displaying all products that are colored red in "www.foo.com" and link back to www.foo.com's product page?
Another way of looking at this is developing sub-domains designed around keywords my customers most use in search engines offering them rapid access. What my goal is to shortcut navigation and search.