On page optimization is also necessary for SEO point of view.........It'll give you solid support to rank your site well and for traffic as well.
Hey, I am reading this thread from the first post by seo.trans, as per my opinion, its a debatable topic,we never judge the %weightage for on and off page SEO but for reference follow SEOMoz.org link to get more idea. http://www.seomoz.org/article/search-ranking-factors#ranking-factors 72 SEO experts have presented their views on SEO factors and impact in SERP I hope you can get your answer over there. Thanks!
another good one would be Rand's video about domain trust and authority where he talks about "issues like inbound and outbound link patterns, registration history, temporal link patterns, and other aspects that can and will affect your domain's trust metrics and its ability to both rank and pass value" seomoz.org/blog/whiteboard-friday-domain-trust-authority so yes on page and domain factors affect the trust of your domain and its pages....
For me, the search engine bots are still paying attention to on page optimization as well as off page. I think with good on page optimization, you can lessen your off page optimization because you will do well on it and just maintaining the rankings.