Honestly I wish I could answer this question, Yahoo seems to be the only SE I can never figure out. One update I'm #1, next update, I'm on page 2-4. It would be nice to see more input about optimization for Yahoo but with the amount of traffic it produces even when our sites are owning specific keywords the traffic is not even 1/20th of the traffic by Google. And now Bing is the #2 referrer for every single site we have and by a staggering percentage (which is rapidly gaining on Google). In any event, it would be nice to see some optimization tips pinned to this forum.
I wish there was more insight into this topic as well.
I ran a test last year and I managed to rank extremely well in yahoo and in no time at all (top 5). Maybe just luck or just due to some strange yahoo algo working my way. What I did was get as many backlinks as possible, and to be honest quality wasn´t an issue. Backlinks from free advertisement sites, blogs, forums. Mostly free ad sites. I would also say 90% of links obtained were nofollow. Yahoo seems to like nofollow?
Recently I stopped this as the site became successful and due to my "Black Hat" link building techniques I was worried about picking up a ban from google. Since I have stopped this all the "free ad" building and all links have been removed and as a consiquence ranking has been lost in yahoo, which is now around the 30-50 mark for KW´s that used to rank 1. From a link building point of view I hope this helps.