Do I apply anyway because academic jobs are so hard to come by?
I think you apply. Because:
1. They might wonder why you didn't.
2. You have someone on your side already.
3. If you get an interview you might realize you like it there.
4. You wouldn't be working in a vacuum (i.e., have at least 1 goo colleague).
5. You have to write your letter, CV, statement, etc already, so just print out 2 more copies.
Most people have to relocate from grad school to faculty position.