Google said it isn't possible to create an accurate P3P header that describes how they use cookies. Having previously tried to parse the standard document, I'm inclined to believe them.
A faked P3P header breaks IE's privacy settings in a nonfixable manner.
Not for the average user. The user who uses the default web browser. The user who uses IE.
I suspect you're right and the uptake isn't what they wanted, but that's not really a valid reason for them to work against the browser settings designed to protect a user's privacy.