So then what does this refer to?
No idea. I mean if you book separately, you'll have 2 different confirmation numbers, but picking seats is the same whether it's 2 confirmations numbers or 1.
I didn't read the whole discussion, but if you're banking on a free bag, priority boarding, etc. because one of the travelers has status or a CC, then if they're on separate reservations, both people will not get the free bag.