This is quoted from post #1:
Your wallet is "in the cloud", and that cloud is the Bitcoin blockchain!
To my knowledge no private keys are stored in the Bitcoin blockchain and my private keys are stored in the wallet.dat file when using the regular client. Here the private keys are stored on a 'seed server', though locked with a strong passphrase?
That's not the smartest way to phrase it, we should change the opening post. No private information is stored on any of the servers and your keys can always be generated offline.