Steve, thanks for your question about the Cat Stop maybe bothering animals in the neighbor's yard. 

I'm not sure if that would be a problem. You can shield the high pitch beam somewhat. Or, since you have a small yard, you might place the unit at the edge of your property pointing BACK TOWARDS YOUR YARD (away from the neighbor's yard) if it turns out to be a problem.

 I, too, have animals in the next yard and worried about the dogs howling or being affected by the Cat Stop but they never seemed bothered by it (though I probably have a bigger yard and also pointed the unit  somewhat in a different direction.

I have used the Cat Stop but ultimately have been disappointed with it. It seems to work sporadically. It worked at first but then the "problem cat" seemed to get used to it and would ignore it.   

I'd recommend the Scarecrow sprinkler unit (though it, too, uses a motion detector, it doesn't put out the high pitch sound as a deterrent--it just turns on the sprinkler briefly.)  But that doesn't do you any good in the winter months.  (It's made by the same company.)

My suggestion is to go ahead and buy the Cat Stop and if it doesn't work for your purposes, return it for a refund.  I've found the customer service at the manufacturer to be excellent.  Or, you may call and ask if you can trade up to the Scarecrow unit.  

Good luck.
Hope 2010 will be a cat-free yard for you.
MJ