I believe the number 100 is the limit of links in a page. and yes the more links the less pr being passed to each page.
But 100 links on the home page means means you can have 100 child pages with 100 links on each means 10,000 links only 2 clicks from home page.
as for re=canonical, is page 2 unique? then yes just as you would for any other page.
I assume you are aware of the flat link stucture, if not I think this page though old is a must.
http://www.webworkshop.net/pagerank.html
Its a long read, but very imformative