I did something similar. My first job out of college was as SE of a weekly (one-man shop) competing against a well-established daily in an area I wanted to be in. I toughed it out at the weekly, made one stop at a daily down the road, and now I'm working at that the daily I was competing against in the area I wanted to be.
Now I'll be the first to admit that I caught a couple of breaks and got to know the right people to land here, but I wouldn't have caught those breaks or met those people without the first job. And my knowledge of the area only made my resume stronger.
I'm not saying take it, but if you really think it will give you a better shot at the job you want, it could be just what you need.
Each of us have different priorities as far as our career is concerned - working at a big paper, working in a certain area, making more money, etc - you just have to figure out what means more to you.