Less importantly, they only take into account devices that have the Play Store (which you might consider your audience, but there are tons of people in the world happy to buy things from alternative markets available on their devices).

However, and this is somewhat insidious: they measure devices used in the last seven days. How often do normal users "actively visit the Play Store"? I find it highly unlikely that every normal user does so at least once every week.

In fact, I would be much less surprised by a universe where people only "visit the Play Store" once a month at best, and only when there's something specific for them to be doing (maybe they hear about a new product, and go to download).

I would then further submit that this frequency decreases the older the device is: during the first month of owning your device, you probably have tons of things you suddenly realize you want, because the device comes with no apps installed.

With an expectation curve on the usage of the device thereby working against older devices, you will see a chart that only looks at the most recent 7 days biased towards recent versions as the probability of older versions dips.

Let's look at what happens then if we posit that the average 2.3 user is using the Play Store once every four weeks, while the average 4.x user is using the Play Store once every two weeks: this mild skew makes 30/70 become almost 50/50.

Are these people who are using 2.3 really outside of your target market because they only download an app every month instead of every couple weeks? If you market to them, and make it clear your app supports them, will they not buy it?

While that might be true, it isn't something you can support with just these numbers from Google. It's even worse, in fact, when you remember that when Google was tracking "active devices" instead of "devices actively visiting Play" the 2.3/4.x split was so far in the other direction as to be unbelievable, and when Google decided "fine, we are limiting it to active users" the numbers jumped.

And now, we see the numbers creeping better and better... but did you notice that they changed the time range from 2 weeks to 7 days in the few months since Apple lambasted their uptake at WWDC? If not, you aren't paying enough attention ;P, as that's a really critical detail: Google keeps moving the goal post, so you can't take any solace in "we are making progress".