Be smart about it, as long as it is relevant for the user and genuinely gives them related information to other subject matter on the site. Having said that , it is mentioned that Google can index upto a 100 links on a page. More info on this link: http://www.seomoz.org/ugc/an-internal-link-juice-tool-14969
Take a look at this site that does quite a lot of internal linking and is ranking at the top for all "office space for rent" and "office space for lease" geo targeted keywords (www.loopnet.com)
To answer point 2 , if you have a 400 word article having 1 to 2 internal links in that sounds like a good balance.
, all the best..