Depends what you mean by "damage". Software alone will never cause real physical damage to the machine (eg., a badly programmed card will not cause the circuit board to suddenly ignite) - but it is theoretically possible to cause "damage" to the software in the machine. To imagine how this is possible, consider this scenario: a provider like Canal+ or Sky who also specify the software design of their boxes and can also direct the box to automatically update their software, decides one day that they will fight piracy by loading new software which takes a specific action when it detects that the responses from a card indicate it is pirated. The specific action it takes is: delete certain key parts of the software. Or alternatively: set a flag in non-volatile memory which generates the message "pirate card detected. Machine locked".
In practise, no provider has every yet gone this far.
And be sure of one thing: independent manufacturers (i.e. those not bound to broadcasters/providers) are benefiting greatly from the existance of an active hobby community, stimulating interest in satellite TV as well as generating sales.
If I recall, the Digiquest P2000 incorporates 2 embedded CAMs - Viaccess AND Mediaguard. So if they were to raise questions about your cards, you might like to ask them why they include those CAMs for the UK market, since neither of them are used by the UK satellite broadcasters, and official subsciption cards can not legally be obtained in the UK (unless you count the mature content subscriptions such as SCT - itself of dubious legality in nanny-state Britain...)