It shows radical changes in readings.
When AC is plugged reading goes up fast (70% full - 30 mins until charged >> few seconds pass >> 80% full - 20 mins until charged)
When running on battery (3 hours remaining >> after few seconds >> 2 hours remaining)
Is it my battery or the readings?

Pretty bad, like most similar tools.
@ OP:
Applications which attempt to guess how long you can run off your battery before you will need to recharge try to use some current readings and a history of past readings to make some educated guesses. In my experience, they don't always work every well even for a laptop on which the operating system is a Linux booted from a hard drive (thus with persistence), but if you lack persistence (e.g. if you boot Tails from a live DVD), you probably shouldn't expect this kind of application to work reliably.