But it will not be a level playing field say 100 users from your site uses the tool bar and does be o your site, and on my site no one uses the tool bar and i have more traffic than you you site will show more points and a higher rank then me.
That's right, alexa ranking is not very accurate, and it highly depends on the countries too, since the toolbar is not equally spread. But they've been improving a bit lately and it's still more or less meaningful to see how site goes up and down.
And I'm sure most webmasters are happy when reaching the top 100 000
Well, running the alexa toolbar yourself and promoting it around, eg advertise for alexa, is pretty much the only way to increase alexa ranking if you have visitors. The problem is that the proportion of the population using the toolbar vary a lot from one country to another, and also depends on the audience itself (age, interest etc). In some case, the rank is just too low and in others it's as well too high. That's the limit of the system (being quite one).