If you redirect to the geo targeted subfolder properly you won't get penalized. Look at biggies - like apple.com. This is how they handle geo targeting.
I like to use large successful sites as good examples of what to do, and I have found the subfolders using the two digit ISO code for each country is a great way to go. I'd be more concerned about the content - make sure it is rich, unique and not auto-genreated.