I'm talking about the sites with a lower alexa ranking who potentially are gaming the results. For instance, I have a "junk" site (its kindof lame) which took about ~30 minutes of my time to make in 2007 and I haven't touched it since and this site is by far the largest in its niche. I know it’s the largest in the niche because, I know some of the other webmasters in this niche & we’ve shared traffic info. Anyway my “junk” site has a significantly higher alexa ranking than its competitors - for instance they are nearly in the top 100k (they get ~60-70% of the traffic) and this site is nowhere near that.
How does Alexa get the information to rank websites? From a toolbar a user has to install ... maybe the people using some place like instawallet wouldn't be too keen on sharing data with a 3rd party.
If you think it is not a counter to his argument, you're missing the point, that low scores are not indicative of low traffic, and high scores are not indicative of high traffic (except among a very specific demographic.)