I suppose it could affect beneficial insects, but it does kill the mosquito larvae. They hang by their tails from the surface of the water via surface tension. I understand that they breath air at that stage via a little snorkel at the tip of the abdomen. The way I understand it is that the citrus oil prevents them from breathing thus killing them, and that the very small amount of oil it self only has a very short life before it biodegrades. Anyways .... just a thought.
P.S. I too have to deal with these pest, and I'm not familiar with "dunks". Sorry for the noob question, but could you please tell me what they are? Thanks... and good luck with your skeeter problem
Paul
P.P.S. - found them .... might give them a try myself.
Here's a link to the product.
http://www.lowes.com/pd_92460-1643-MODU1_0__?productId=3047384