Meaning/accuracy of GWT backlink count?

[RealtorAl]

I have a website. There was site-wide link to my site from another site. I had a dramatic drop in traffic (75%) in early March. It seemed to coincide with the increasing count of back-links from the site above. The site-wide link was converted to a single link from one page to my site in late March. In GWT/Links to your site, there is still a large (>5000) number of links listed from this site to mine. The number has been shrinking but slowly--about 75 links/week. I have several questions as follows:

What does the backlink count represent? The number, > 5000, exceeds the number of indexed pages for the site, obtained when I enter site:<domain>

Are the supposed back-links from this site hurting my ranking? What does it mean when this number decreases? Is there a way to increase the decay rate? The site-wide link was in a sidebar navigation element which is included in every page of the site. If I could cause a part of this sidebar to be modified would that cause Google to re-crawl all pages of the site, causing the back-link count to be reduced?

I notice in GWT/Links to your site, that if I click on the site that links to my site and then on the page that is linked to, a total of 12 linking pages is displayed. How does this square with the link count > 5000?

Appreciate any help.

[fathom]

What does the backlink count represent? The number, > 5000, exceeds the number of indexed pages for the site, obtained when I enter site:<domain>

Canonical issues can prevent multiple pages from being displayed in results but Google still has data on them.

Are the supposed back-links from this site hurting my ranking? What does it mean when this number decreases? Is there a way to increase the decay rate? The site-wide link was in a sidebar navigation element which is included in every page of the site. If I could cause a part of this sidebar to be modified would that cause Google to re-crawl all pages of the site, causing the back-link count to be reduced?

In context there are multiple things that can occur but commonly a single domain with a link on every page due to being on an include file rarely will negatively impact any domain, in and of, itself.

Googlebot must recrawl every page to record any changes and it will never do that all at the same time.

I notice in GWT/Links to your site, that if I click on the site that links to my site and then on the page that is linked to, a total of 12 linking pages is displayed. How does this square with the link count > 5000?

Can only guess about this one. Would probably need to see this to comment accurately but any conflicts in the numbers (the overall gist) are likely just sort variation or reviewing from a different vantagepoint.