"Just by its nature, SEO is bad" This statement is ridiculous. You are a fool is you don't do everything you can to rank for relevant terms. This is the best, most targeted traffic you can get. Gaming the engines is bad, but not trying to rank in them is idiocy.
I mostly meant the gaming part and the industry of SEO 'experts' who are involved with that. You are obviously right that search engine traffic is great. However, it is a waste of time focusing on doing "everything you can" to rank in the search engines, instead of for instance, working on making a good product in the first place. Search engines today usually use a QA feedback loop to figure out what ends up being the most relevant result for people. So if your site is good and the best, it will rise to the top anyways.