Google doesn't disclose this information to the public, so nobody really knows what to do in terms of keyword density, despite what they may say. As a general rule though, the optimum keyword density, whatever it may be, wouldn't change with how many words the article contains. That's why it's described as a percentage instead of an actual number.
As for which is better of those two keywords, that depends. The optimum keyword is the one that has a decent monthly search volume that remains fairly stable throughout the year, low competition, and a high cost per click for contextual ads displayed against the content containing the keyword. Even if a keyword has 100,000 monthly searches, it wouldn't be a good idea to use it unless you can beat the sites that rank in the top positions for that search, and the higher the search volume, the more likely there will be strong competition to contend with.