When linking to the authority websites in your niche to improve SERP and for SEO, do you link to the websites that are on the top of the search results for the keyword you want to target, or the highest PR, biggest websites in your whole niche?
Why would you link to your competitors? If they're going to provide a link back to you, then you should ask for a link exchange. If they're on top for your selected keywords, then they have the niche authority.
imo trust>page rank nowdays if anything a more trusted site will = more traffic since its well kown Im not really into pr at all
It may be beneficial to link to the authority websites, as Google will then see that you are related and include you in the topical "network". Getting these authority sites to link to you would be huge, but obviously much harder to do. I suggest you link out to quality sites in your niche without using search engine rankings as the sole factor. Of course, quality sites will naturally be correlated with high rankings in most cases but you want to get the interest of up and coming sites that have not yet reached supreme status. It is much easier to get links from such sites before they gain traction and become authority sites.