Actually, your analysis only seems to make sense because you ignored the beginning of the explanation. I'll rephrase it here in other words: "Man's good can only consist in the 'work' that is peculiar to him, that is, the work that he and only he knows how to perform, just as, in general, the good of each thing consists in the work that is peculiar to that thing. The work of the eye is to see, the work of the ear is to hear, and so on." So, it becomes obvious that making an analysis based on the universal concept of "knife" and judging it by its ability to literally cut anything is absurd. The more accurate approach would be to judge a "kitchen knife" by its ability to help in cooking tasks, and we can be even more specific by talking about knives for bread, meat, tomatoes, etc. And I find it quite strange to question "what does it mean to cut well?" If I give you a dull blade and a sharp one for a specific task, you'll know exactly which one cuts well