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In my view it still has a large influence (although Google has stated this is diminishing). Short term strategy - go for the second domain. Long term strategy - go for the first. You'll create a better/more memorable 'brand name' and eventually Google's algorithm changes will reduce the importance of keywords in the domain name. You'll be able to get good SEO results, it will just take a little longer.

Its just google and its hitting all section of the site equally. Most keywords drop by a number of places and then bounce back. They did this a number of times, but haven't yet bounced up again.