I see a lot of people say that when they are searching for keywords to rank by using Google Keyword Tool, they see the competition column and think that if the value of competition is Low, so that the keyword is easy to rank.But it's not true.The competition here mean the competition of advertisers (who want to advertise that keyword).That means: if the value is high, so that the keyword has a lot of advertisers (they compete each other by bidding) and therefore the CPC may high ---> Golden keyword but it's not easy to rank
It's true but since Google is the top search engine and kind of rule the site searching including with the CPC, so Google Keyword's toll is vital and you must focus on it if you really want high page rank.
what ever you said is right but no one follows it completely . They just get a suggestion about that keyword and check those in other keyword tools and then they add it to their site.