Was Dutch geography a strategic trap?

Were the Dutch trapped in a no-win strategic position by their location in Europe?

Largely yes: they needed a major army for their borders and a major navy for their empire, with an Anglo-Dutch union being one possible escape from that burden.

The Dutch faced powerful land neighbors while also needing to protect a worldwide trading empire. That forced scarce resources into both army and navy without giving either service an easy strategic sanctuary. A durable Anglo-Dutch union under William and Mary might have divided the burden more effectively, with Britain emphasizing naval power while Dutch forces defended the continental position. Even that counterfactual would not remove the vulnerability of the Netherlands to occupation by a major continental army.