Is there a difference between the risks associated with abdominal fat located over the muscles compared to abdominal fat that forms internally?

Yes. Fat inside the abdomen is termed 'visceral' and is considered a heart risk factor and are difficult to lose; subcutaneous fat deposits are available for surgical reduction via liposuction or surgical removal. Distribution of subq fat is genetic related, and diet/exercise effects area differently. Fat is the largest endocrine organ of the body, essential to energy storage.
Absolutely. Intra-abdominal fat appears to contribute to the "metabolic syndrome" associated with high blood pressure, high cholesterol and high blood sugar.