Usage of the word “understatement”

Solution 1:

What the author is saying in this case is that Strassen's algorithm is very, very, hidden, i.e. even less obvious than 'not at all obvious'. An understatement is saying something in terms milder than reality; in other words, you're not doing reality justice by describing it in such a mild way.

Thus, to say that 'not at all obvious' is an understatement means that 'not at all obvious' is too mild a term for how not-obvious the algorithm is.

Solution 2:

It means that the algorithm is extremely non-obvious, so saying that it's not at all obvious is an understatement.

Solution 3:

By referring to his comment as the biggest understatement in the book the writer means that in saying that the algorithm is not so obvious he was not really putting it strongly enough. What he now thinks he should have said is something like the algorithm really, really, really isn’t obvious at all. No way. No how. Never in a million years.