I guess the real point of my question was how vital is it to be in the top 5 for bids?
Trial and error...
Sometimes I start off bidding a bit higher than I should until I get a few clicks and an idea of what adsense will pay for them and the ctr, then adjust my bids so I'm paying about half the income. If I can't get any traffic at that price, raise them until you start getting traffic, while keeping them low enough to make the whole thing worthwhile. Don't worry about micromanaging the lower-traffic keywords, concentrate on the higher-traffic ones until you get an idea of what your pricing should be.
Once you get a day or two of traffic at the lowest price you can, try raising the price (but still within your margin) and see how much traffic you can get at the higher price for a day or two. Then compare the profits, and either stay at the high-price-high-traffic or go back to the lower-price-lower-traffic.
I know some of you might think that's too much work for one niche, but I found doing that at the beginning for a couple of niches helped me get a hang of the pricing.