buckworks - 12:33 pm on Nov 30, 2011 (gmt 0)
So quality score is mainly based on CTR and CTR is mainly based on ad position
There is also a correction applied for position, so that getting a better CTR just from bidding high is not the whole story.
If your ad is showing low on the page, but its CTR is better than average for that position, the quality score formulas will notice that and give credit.
no doubt that conversion rates are much higher if your ad position is higher
That can vary in different sectors so it needs to be monitored. Some campaigns do well by always bidding for the top position, while others do better by bidding a bit lower and letting the top guy pay for the curiosity clicks.