This is the definition you get if you say "let 'good' mean 'human values'". But the actual idea is meant to be more analogous to this: assuming for the sake of argument that humans value cake, define "good" to mean cake. Obviously, under that definition, "cake is always good regardless of what humans value" is true. In that case "good" is a rigid designator for cake.
Why is cake a referent of good?
The difference is that "good" and "human values" are not synonymous. But they refer to the same thing, when you fully dereference them, namely {happiness, fun and so forth}. This is the difference between sense and reference, and it's why it is necessary to understand rigid designators.
And what happened to the normativity of Good? Why does it appear to make sense to wonder if we are valuing the right things, when Good is just whatever we value?
ADDED:
The reason Eliezer's views are commonly mistaken for relativism in the manner you describe is because most people do not have a good grasp on the difference between sense and reference(a difference that, to be fair, doesn't seem to be well explained anywhere).
I don't see the S/R difference is relevant to relativism. If the referents of "good" vary with the mental contents of the person saying "good", that is relativism/subjectivism. (That the values referenced are ultimately physical does not affect that: relativism is an epistemological claim, not a metaphysical one).
Why is cake a referent of good?
Why do we have words that mean things at all?
Why does it appear to make sense to wonder if we are valuing the right things
For a start, the fact that some things seem to make sense is not a oracular window unto philosophical truth. Anything that we are unsure about will seem as if it could go either way, even if one of the options is in fact logically necessary or empirically true. That's the point of being unsure (example: the Riemann conjecture).
At the object level, no-one knows in full detail exactly what they mean b...
There seems to be a widespread impression that the metaethics sequence was not very successful as an explanation of Eliezer Yudkowsky's views. It even says so on the wiki. And frankly, I'm puzzled by this... hence the "apparently" in this post's title. When I read the metaethics sequence, it seemed to make perfect sense to me. I can think of a couple things that may have made me different from the average OB/LW reader in this regard: