I'm definitely not saying that if you write a long post it won't be engaging - my last YouMoz post was over 2,000 words long, has had more than 40 comments and been tweeted about more than 400 times (self plug over). Long, engaging content that gets people talking is just as good as short content that gets people talking!
My point - and I think Chris's - was that if your article can be written in 200 words, don't put a load of filler in there to get to 1,000 because that's longer. You're likely to get less engagement, and so less tweets, shares, +1s, and backlinks. And when it comes to the ranking algo's that social interaction and linking is what you need to aim for, not length of article.
As an aside, I can't remember the last time Seth Godin wrote more than a couple of hundred words - and he seems to be doing alright!
I've not heard of Google looking at spelling and grammar specifically - could you point me to where you heard that, as I'd be interested in seeing it? But again, that could actually be an engagement question: "are people more likely to comment on a post if other comments are well written?" The thing about comments is that they somebody else's voice, not yours, so if you start editing those people's voices they may feel a bit aggrieved and so may be less likely to comment in the future. That will drive down the number of tweets, share, links etc and so adversely affect your SEO.