keyword URL Paths and site structure

keyword URL Paths site structure

[eztrip]

I'm wondering how directory structure affects optimization of pages for Google. I've scanned the forums and haven't been able to find the sort of comparison I'm looking for.

I have a site where dyanmic pages appear as static HTML pages using custom server side code. My widgets are related to geographic regions (which are keywords or potentical keywords). I have played around with the following 2 approaches so far:

1) www.mysite.com/US_CA_12356.html
or
www.mysite.com/123456.html

2) www.mysite.com/United-States/California/widget-name/widget.html
or
www.mysite.com/United-States/California/widget-name/123456.html

WIth the first approach, my site is all at the top level and I thought I read that this was a good thing.

Bu the second approach definitely adds keywords to the algo (or at least according to some folks on this forum) but it also makes it appear that my site directory structure is many levels deep and I'm not sure this is a "good thing" for things like page rank, etc.

Any advice would be appreciated.