Hi Josh,
Thanks for describing this scenario so thoroughly. My take on this may not come as good news to the business owner, but he deserves to have a proper understanding of the situation.
What the business owner did in setting up Google Place Pages for non-physical locations was a violation of the Google Places Quality Guidelines (https://support.google.com/places/answer/107528?hl=en) three years ago and remains a violation now. The current guidelines really put this in black and white:
Do not create a listing or place your pin marker at a location where the business does not physically exist. P.O. Boxes are not considered accurate physical locations.
Because of the clarity of Google's stance on this, the only legit way for the business owner to maintain listings in his various service regions would be for him to get genuine physical locations there with non-redirecting, distinct phone numbers. If he can see that having these listings, under whatever circumstances, has benefited his business, then perhaps he would be open to renting modest office space from a company like Activspace.com which would give him a real walk-in door and phone hookup. Thus the violation would be removed.
The addresses would, of course, then be new and the listings would need to be edited (rather than suspended). The one downside of this is that it's highly likely that he would lose some or all of his Google-based reviews attached to these businesses, because of the new address, but that would be a small loss compared to the total loss of his listings. This change of address (and possible phone number if the ones currently being used are re-directing) must then be followed up with a citation cleanup campaign in which you would find as many references as possible to the old NAP data and update it with the new data. With these legit offices in place you could then proceed as normal with the Local SEO campaign and begin building new citations for the various offices.
It may be that the business owner would only be able to afford renting space for one or two of his other locations, in which case, anything that falls outside of this should be removed via Google's troubleshooter.
The only possible alternative to this would be for him to appoint regional managers amongst his staff and change the business model to turn a handful of his employees into receptionists who are authorized to answer direct phones, book appointments and manage business out of their home offices. This can be an iffy solution, however, because Google can see that these businesses are run out of homes and the forecast is less clear as to Google's stance on this. Google knows that businesses are home-based, and for a single location, using a home address (hidden) should be fine. But there is some grey area as to whether service area businesses operating out of home addresses call up red flags at the Googleplex. I have seen some outrageous things in which people are posting on Craigslist offering to pay total strangers for the use of their home addresses to appear local. Google's ultimate position on this is not totally understood - thus my designation of this solution as iffy.
If the business owner cannot get legitimate spaces for any of his service areas, then, yes, you would need to remove the other Place Pages.
What if you do nothing? This question deserves to be asked and a considered answer provided to the business owner. As he has seen, Google doesn't do a great job of upholding their own rules much of the time. Businesses can get away with all kinds of violations for indefinite periods of time. The problem with this approach is that the business owner never knows when the axe will fall, and if his main, legit listing is associated with a bunch of spam listings, he could possibly see his whole account penalized. If he is then heavily penalized or even banned, he will go from having a lucrative presence in Google+ Local to having little or none and this is likely to prove disastrous for any local business. He really won't have a leg to stand on in pleading with Google to reconsider his business after rushing around trying to clean up his record - an awful scenario! So, while you could potentially decide to let the spam listings ride, understanding the risk being run should figure largely in such a decision.
As I see it, your job as the new Local SEO on the project is to educate the client as to the realities of the situation, the opportunities in front of him and the possible outcomes of different routes he might take. Personally, I won't work with a company that persists in wanting to violate Google's guidelines once I've explained the guidelines to them, but some Local SEOs will work in grey areas. Happily, you get to make your own rules about the work you do with clients. I think the main thing is to understand and share all possible information with the client so that everyone is operating with awareness.
Hope this detailed response is helpful both to you and your client!