AFAIK the term "distribution" was coined because the released package included *more* than just an OS -- there were also applications etc... I don't think there is any doubt that the distributions include "a real OS".
It was a binary flavor of Gentoo, and the big discussion was about whether or not that was truly representative of Gentoo or not.
And the conclusion, if I remember correctly, was that performance considerations were secondary to the great learning experience Gentoo offers, and that if you actually care about stability, security and your own time you are much better off with any of the binary distributions out there. It's like houses really; you could build your own if you were so inclined, but you wouldn't expect the end result to be comparable to that of professionals.
Benchmark it against Gentoo Linux and it will not do quite as well. It is fast in terms of non-Linux-based operating systems, but as far as Linux-based operating systems are concerned, it is not quite as fast. The main reason for that is its generic kernel. Alternative, but lesser performance penalties include its high memory usage from having bloated binaries, the version of GCC that is used for compilation and the flags used to compile various packages, although on a system with sufficient memory, bloated binaries probably are not much of an issue in the sorts of tests Phoronix is doing (i.e. things that are not load time tests will not show any difference) provided sufficient memory and GCC performance is fairly uniform across both recent versions and common compilation flags.
Hasn't phononix not already shown that Gentoo is not really faster than Ubuntu or any other distro out there? If you want I can find you the link to the article.