Keyword Density is the percentage of the keyword in question divided by the total words. Keyword density is calculated on body text, title, meta description tags, ad nauseam. There are experts that will tell you that 3-6% is ideal, others say much higher, some say lower.

The bottom line is that a domain that has some authority, branding, and age can get away with more than a new domain starting from scratch whether it be keyword density or otherwise. Keyword density for top SERP's varies wildly based upon niche. Publishing with a specific keyword density in mind is old school seo.

Long Tail vs Single Word Optimization
It can be really tough to achieve the same keyword density for a three or four word phrase on a page compared to the singular keyword. The ultimate goal is not to get traffic. The ultimate goal is to get traffic and convert it. Writing for traffic usually means horrible copy.

High Rankings
On page optimization is an important part of seo. The title tag, h1's, bold text, and spreading the keyword out (beginning and end of page) are important for relevance. These factors are much more important than specific keyword density for every page (Yahoo seems to like more density than Google).

Obtaining the right links, in the right places, with the right anchor text is much more important than anything else for ranking and to build some domain authority.

I am ready to duck the pies that keyword density proponents are probably ready to throw!