AFAIK, to win a small claims court, you still have to prove that you deserve the money. I see nowhere in the story he admits to the judge that he violated to ToS. He simply used the lack of customer service at Google/AdSense to win this case. As I mentioned it is amazing that Google sent an unprepared para-legal to defend themselves.
On the contrary, it would have been amazing if Google had sent a highly trained lawyer to deal with this. The amount in question, about $760, is probably less than a day's wages+benefits for a Google lawyer.
If you want to optimize for justice, there are plenty of failures in Google and Google's ad programs. They seem to be pretty clear about their intention of optimizing for profit, though.
No, (at least in Canada) they do not. Small claims is not judged by a "real" judge and those courts do not have the ability to set precedent. Same with most traffic courts. Of course you can always bring up the judgment in another small claims court, just won't be taken as rule of law.