How accurate?
Not too terribly accurate. Things that will affect the reading on the gauge includes humidity, ambient temperature, barometric pressure, how fresh your battery is (cranking speed, faster = less ring leakby), number of compression cycles in the test. It's a rule of thumb.
There is little practical value in calculating the theoretical compression ratio unless you are making modifications to one of the key parameters (bore, stroke, cylinder head volume, piston crown volume, intake and exhaust tract efficiency). If you are making one or more of those changes, what is your target? Theoretical compression ratio can fool you. For example, how many threads have you seen on this site claiming that there is no way regular gas will run in our engines because of the high compression ratio?