The "best SEO is no SEO" is a reference to the recent penalties that Google have issued to stop webmasters from over-optimising their sites.
SEO is concerned with helping site owners to craft their web copy, page titles, meta descriptions, image names, etc, so as to maximise search rankings while at the same time providing a great user experience. In addition to the website being tuned, SEO is concerned with building high quality inbound links to help the site rank highly on search engines, since those search engines rely on inbound links as 'votes' of popularity, authority and importance.
Keyword selection is done prior to that SEO work, so that things are crafted based on those targeted keywords. The selection of keywords will take a look at search volumes, competion, existing rankings and the extent to which those terms are a part of the 'buy process' and not terms strictly being used for research/information.
A classic example is 'weather in Dubai' versus 'hotels in Dubai'. While the former may have a lot of search volume, it will rarely result in sales of hotel rooms. Equally, search terms like 'cheap hotels in Dubai' or 'hotel room discounts in Dubai' are much more likely to be a part of the buying process.
SEO is no more a dark art than is buying a banner aid, posting a press release or writing a blog article. In fact, much of SEO is concerned with content marketing.