What I have is a page with almost all offsite links. Each clicked link is forwarded on to the destination. What I would like the search engines to do is to index the text between the anchor tag and not follow the link itself.

<a href="somelink">Index This Text Only</a>

I've read several articles and they all seem to contradict themselves as to when to use nofollow.

What's been happening over the past 2 months that the site has been live is that both Google and Bing are crawling the site as well as all the links on the site that it has been forwarded to. The search engines are now generating a lot of 404s for images and files that never existed on my site but rather seems to correlate to the site it was forwarded to. The search engines don't seem to honor the 302 header when forwarded.

I would like to get a definitive answer on the nofollow tag as it relates to my situation. Can I use nofollow to stop the 404s and if so, will it affect my page ranking negatively?