She knows more than me, I thought that page rankings were based on how many people link to your site, not how many actually visit. Who knew?

OP here -- You are correct, it is mostly about who links to your site -- but things like bounce rates and whatnot do affect rankings as well; hence the partial credit being awarded

>but things like bounce rates and whatnot do affect rankings as well //

How do Google, say, use bounce rates - they do have bounce rates for folks using Analytics, and I guess they could guess some form of bounce rate by analysing search clicks but they'd be missing data for lots of pages and lots of visits on pages they could get a rate on. So, do you have any insight in to how they or Bing or whoever do it in practice; or is it just a guess?

SEOmoz ranking factors, http://www.seomoz.org/article/search-ranking-factors#metrics..., (and other pages there) suggest it's based on clicks on SERPs that follow after a visit to your site. Is that the/a known method or just the most speculated method.

Seems it could be potentially abused, so for example the "are you sure you want to leave this page" (onbeforeunload) type warnings will clearly elongate the page visit duration.

People who click a search result and then immediately return to Google.

Are you speculating there? Is it for all users or just logged in? If I open several links from a SERP in tabs then am I adding to stats to give a higher bounce rate?

It's a combination of both, as well as a large number of other factors.

Google has a list here: https://support.google.com/analytics/answer/1032321?hl=en