It's a general gauge of the machine's condition, but as people have mentioned it depends on a lot more than plays. Someone who played it 500 times but did no maintenance may have a machine in worse condition than one with thousands of plays that was cleaned and maintained meticulously.
It can help with someone claiming a game is HUO when it has enough plays to be routed for years though. Then again if they're going to outright lie about the state of the machine I'm sure they can find a way to reset the number of plays.