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My average position was 2.9, so I'm not the cheapest guy out there.
Is there any reason to disable a keyword besides a low CTR? I have other keywords that are doing much better, but Google's guidelines say I should have at least a .5 percent CTR.
I've been monitoring it, and I'm pretty sure that the CTR has been pretty consistent - and not a big burst to start out followed by nothing over the past 1000 impressions.
Its the keyword status, i.e. at risk, strong, etc that tell you how your word is preforming on G.
Average position doesn't necessarliy mean you're not the cheapest guy out there. If they were bidding 0.05 with a 5% CTR, and you were bidding $0.50 with a 1.8% CTR, you would have a higher position, be paying more, but getting less clicks.
Here is the thread about keyword status.