Very good Terra Nova piece on the whole "How big is Second Life" thing by Edward Castronova. As far as I'm concerned you need only read this alongside the Shirky diss. For extra grounding, combine Shirky and Terra Nova in the comments here.
Using the "people who ever took an interest in Second Life" number used (which just passed 3 million btw.) as the official size of Second Life truly has backfired - and it's probably not done backfiring yet. Its a a pity, since there are interesting real numbers below, just not quite to the scale of the "people ever taking an interest". The only ones I personally find interesting are "maximum online concurrently in the last 24 hours" and "number of people economically active last month" which has been pretty consistenty at 4-5 times the max number of users concurrently online. It seems there's a about 150K users of Second Life these days. Furthermore it's in the nature of an accumulated number like the "people who ever took an interest in SL"-number to get further and further ahead of reality as time passes. Last september the ratio of max concurrent users to people who have ever tried was about 1 to 70. Now it's more like 1 to 100. So the hype will only become more insincere as time passes. Probably wiser to just stick to the real story and hope that's interesting enough.
Castronova compares Second Life to Mayberry and if we assume that virtual characters have only one tenth of the expenses of real people, that's probably not to far off.