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An exact quote would help; I find this interpretation confusing. The proceedure seems quite simple to me.

If rmdir TESTD succeeds, then the two links TESTD/. and TESTD are removed. So the link count of the specified directory falls to 0. This can be verified by running a shell inside the directory and running ls -ld after the directory has been unlinked (removed from its parent).

Once a file (such as a directory) has no links, and no running processes with a reference (file descriptor or current directory), it will be truly deleted.

Note that link count is irrelevant to whether rmdir can succeed. Creating a file in the directory prevents it from being removed. But creating a file does not increase the link count of the directory. The test that stops rmdir from succeeding is if "pathname contains entries other than . and .. ; or, pathname has .. as its final component." (man 2 rmdir).