No, it's not about stuff you know.
This was posted recently, but it was so good it's worth repeating:
http://blog.robertelder.org/50-interviews-with-facebook-twit...
The interesting point is the distinction between skill and talent.
Skill is close to competence. You can solve well-defined problems using standard tools and practices.
Talent is close to proficiency. You can not only improvise good solutions for novel problems, but you can also prioritise problems intelligently to achieve strategic goals, because you have a clear view of how the codebase fits into your business or project.
Without talent you can waste a lot of time by picking the wrong tools, or using tools in the wrong ways. Even though your code may be perfectly correct, the solution built with the code can still be completely wrong or useless.
In fact talent is somewhat orthogonal to skill. You can have an untrained version of that overview talent, but it's not so useful if it isn't grounded in skill.
When you have both, you have real proficiency - good code doing the right things to solve the right problems.