That's probably the most singularly important piece of advice I've ever received regarding poker. You can have pocket aces, but if you're in the small blind with 6 others, that's not a good situation at all. Conversely if you're on the button with 43o, an early raiser and several callers, that could be very profitable with the right flop (trips, 2 pr); the deck is likely rich with smaller cards. (that situation won me a nice pot in my regular 3/6 game sunday night)

Everything about poker is situational. Everyone's heard the reply to the question "how do you play XX?" - "It Depends." When you're in a hand, you have to constantly be evaluating and re-evaluating. Analyze information like position, types of players, tendencies of players, texture of the board, pot odds and implied odds, etc. Know what to expect out of a given situation before that situation arises.