From general research on the internet I understand that RSS does help in creating links to your site (back links or inbound links?). I am purely raising this from a bookmarking point of view or when one subscribes to a feed they are automatically giving that site a link. Everytime one clicks on the feed and it has been updated this counts as a link generated to the publisher of the information. I guess I understand the concept but would like a better understanding of the technical side of this process? Anyone able to shed some light or futher clarify my understanding above?
RSS is a way of syndicating your content - any way you get your content out there is going to help with traffic. Think of it as additional advertising (if you don't advertise it, noone's going to know about it). Use a site like feedburner to track who's actually subscribing to your RSS feed.
Well, RSS can build backlinks if your audience decides to link to you on their own blog. But I wouldn't depend on RSS for backlinks.
It also brings traffic. Just subscribing to a feed probably won't help much. In many cases feeds are private, nobody can see that. But if the subscriber makes it public others can see it.
RSS is for content distributing. Especial for me, I always use full content output in feeds. Only when users want to leave a comment or trackback my post, will come over to my blog. RSS has some traffic effect, not big. RSS has small backlink effect. It is good to submit your RSS in the Google Webmaster tool and let Google know much about your blog posts.
RSS is definitely a great way to build up some links... also, alot of those RSS directories are dofollow
The nice thing about RSS feeds is that you can reuse them too. You can of course set up an automatized blog from them, but you can also create blidgets (which are widgets for blogs), see for instance widgetbox.com It's like killing as many birds as possible with the same stone