Personalized results: One persons #1 is not everyone's #1 and personalization is on the rise making rank watching pointless.
I am sure you are correct in this. I tend to judge rankings by how they show up in the google webmaster tools where I can see ranking positions by page. That at least gives me an average for the people who searching. Although I don't know the accuracy of that tool.
In all, I've been able to recover much of the lost traffic.