It's hard to get listed unless you're already reasonably well-known i.e. listed somewhere else or proficient with seo.
I don't think so (but I could be wrong).
I do believe that SEO is a handicap, rather than an advantage, because most SEO is diametrically opposed to how the ODP works.
I also believe that the vast majority of new editors are, themselves, unknown in the industry.
There is, in my opinion, a constant level of concern that spammers will get in and only promote their clients or their point of view. That is not helpful to the directory. Case in point: I am a member of a particular political party and I ahve strongly held beliefs. Yet, I edit in regional, thus I have to put my partisan political beliefs aside and give office seekers and holders from the other parties listings with descriptins that are just as complete, and balanced as I do for my own party's candidates and office holders. Do I hate doing it, absolutely. But it is something that I have to do (even though I am yelling at the monitor, calling the opposition candidate unprintable names, the entire time I am doing so). I also ahve to be able to legitimately judge when a candidate's web site (from any party) does not meet our editorial guidelines, and I am expected to be scrupulous in doing so. Like most experiecned editors, I probably give the other side a fraction of a break, in the name of fairness.
Of course, I am just using politics as an example. In commercial websites, one has to not just list competitors who suggest their own sites, but also be able to seek out and find competitor websites that have not been suggested. and also be able to discern when a site is not listable, regardless of the ownership.
There is also another aspect to all of this that seemingly defies logic: volume.
In evaluating new editors, the volume of suggestions or the amount of spam are actually reasons not to approve a new editor. If you think of helping a new editor get starting in the same context as nurturing a child, some of our policies make sense. You don't let a toddler cross the street alone, no matter how badly you want to get across, or how thin the traffic appears. We don't turn inexperienced editors on to spammy or high volume cats until they have the experience to be able to handle and cope with what they are getting. This is not just something that happens to new editors. I have more than 15,000 ODP edits, yet just like you, I must apply for any new category i wish to edit, I must supply three URLs, and unlike you, my entire editing history is open to review. If I'm not doing a good job with what I have, it is hard to get more. There is a nice urban myth within the ODP that says: don't apply for categories that are significantly larger than your total number of edits. It is just a myth, since there is no formal rule to that effect, but it is a good piece of advice, nonetheless.
Unless the letter your received clearly discouraged you from trying again, keep on trying. Many highly successful editors have 4, 5, 6 applications turned down until they finally got in -- and in many cases they got into a very small regional subcategory of minor interest to them, and used it as a stepping stone to become experienced, successful editors.