Onsite optimization is a set of changes you do on your site in scope to get better position in search ebgine.
Backlink building is to get high PR in the first place. You can't get any PR if you don't have backlinks. You WILL still get some PR without backlinks if you have many inner pages on your site which will point to your Home page.
Backlinks are also important to get listed high in Search engines. But PR and Search engine position are two totaly different thing. The strongest tool for high listing are keywords (keyword phrases, keyword density, keyword placement...)
For onsite SEO it's important that you don't have dynamic URLs (Use
URL rewriter if you have them) and deleted pages - which you created and deleted them. Google will still have info abot these pages and if there is no more content on them, your whole site can geta lower weight for this. So use 301 redirect of deleted pages which will direct visitor on a Home page.
Onsite SEO has to be done manualy, but there are many
tools for help.