1/ stealh in pvp is very effective
2/ stealth in pve is rather limited and yes, it's effectives is determined by your stealthing skill (50 is very very low, even 800 doesn't guarantee success). With stealth metter (also called stealth gem) being bright you have higher chance of failure, you want it very dark.
Here is an explanation of stealthing and stealthing gem/metter:
http://aochideout.blogspot.com/2009/...-sneaking.html
(please note that this guide is from 2009 so many thing have changed, stealth gem/metter is the same thou)
direct link to stealh gem/metter:
http://2.bp.blogspot.com/_uM8tNusMzv.../lightdark.JPG