Keywords would be one of those "what is this, 1995?" moments. The WCAG recommends %/em, so use %/em.
Personally, I like to set body to 85%/140% (second number is line-height!) for most sans-serif fonts, though I'll sometimes drop to 80% for verdana or ms trebuchet... 85% delivers basically 12pt (14px@96dpi/17px@120dpi) in most cases, the ideal size according to research on the subject.
Mind you that's for e-mails, but it seems to apply well to websites too. (and they are talking pt, NOT px!) though as they noted, just changing the face changes that rule -- verdana seems more comfortable at a smaller size. Serif fonts because the serif's dirty up the font thanks to the low DPI generally need larger sizes -- which is where that 100%=16px @ 96dpi number originally came from for Times New Roman... Even TNR isn't all that legible that small even on low pitch displays, and more heavily serifed fonts typically require 20px or more for the best legibility (100%=20px @ 120dpi)
It's also important to understand the different behaviors of each font size/type. I wrote a page some time ago that shows how all the different renderers behave when sent different values.
The side-by-side comparison about halfway down the page shows what/why/where (and why anyone who needs accessibility doesn't use gecko based browsers like firefox and gets annoyed with IE8's new behavior).
You also have to ALWAYS keep line-height in mind. You change the font-size, change the line-height. That's illustrated on that page as well at the bottom, where the font-size is changed but the line-height remained fixed. (that one can really confound nubes)
Finally, always keep in mind you magic font might not exist, might be outright ignored, hence the use of fallback families... sometimes it's better to err on the side of too large should your font not exist and the default one be too small. There are also cases like image interactions where you may find yourself forced to use PX for compatibility between different system metrics (even if FF completely screws the pooch on that by resizing PX when it shouldn't!). In that case keep in mind the above 96dpi numbers as the minimums for 120dpi users -- so go below 14px at your own risk. 12px/smaller should be avoided at all costs unless it's something like a menu that's in all-caps...
Oh, yeah. All-caps buys you about 15% size on legibility, but really should only be used on single words like in menus.
Ah, the joys of a screen target.