Hi lynnieK, and welcome to WebmasterWorld.
From your description, it sounds like the design company may be selling snake oil of a kind that could get your colleague's client into some difficulty with Google. Buying or selling links that pass PageRank is a violation of Google's webmaster guidelines, and it's a risky way to start off a site.... Information about buying and selling links that pass PageRank
This could apply both to "text link ads" or to "blog ad links". (I'm making an assumption here, btw, that passing PageRank is part of the package. Why else get this type of link?)
While there's quite a bit of disagreement among some webmasters and SEOs about whether or not Google can determine if a link is purchased, there are numerous recent reports that Google has cracked down on bought links fairly hard. I suspect this particular client doesn't want to play those kinds of games.
In my experience, uninformed designers trying to "help" with SEO can be a menace. Particularly in this case, where the design company has already demonstrated its approach, I would suggest that the client not only ignore any SEO advice from the design company, but that the client should get a qualified SEO to check out the site before launch... to make sure that the design company hasn't tried other stupid tricks that might create problems.
"Blog ad links", I should note, don't sound much more promising than "text link ads" as a way to boost a site in Google. Google values freely given editorial links, given as recommendations or "votes" for a site's content, products, and services.
I suggest reading Google's webmaster guidelines as a starter, and then reading discussions here, keeping Google's perspective in mind when you read.