I think you're right, but I don't think the breakdown is as drastic as 99%. Traction is most important by a wide margin, because it proves that you're doing something right. This is a capitalist society where the market dictates what succeeds, and if the market dictates you're succeeding, then you're a hot commodity.

As far as YC goes, most HAVE traction by Demo Day, significantly so. It's not like these companies have an early beta with 20 users and are raising on a name. Most of the time they achieve early traction from a combination of YCs guidance and the fact that if you get into YC, you're typically a pretty good entrepreneur and have a higher likelihood to succeed.