how is this even a question? so you have 3 install limits. that means that only 3 people can potentially install it instead of 50 million.
I wouldn't say it stops piracy, but it makes people think before doing or scared to do it. This doesn't take into account game hacks and stuff that remove the install limit.
They've already admitted DRM is going to eventually be broken, and that they plan for that. So if you already know your system is going to be broken, why put an install limit on it? It doesn't delay the time it takes for crackers to break the install limit one iota, nor does it make them "think twice."
Here is how a cracker looks at cracking the game.
1. Create the crack
2. Test the crack, see if you can install the game without it calling home. (you do this WITHOUT having the internet/network cable plugged in).
3. if step two fails repeat.
4. publish crack.
That is the work flow, in a nut shell. You can see, that the only consideration they would take to the install limit is making sure their internet is unplugged before testing out their cracks. It is barely even a consideration to them, and definitely not a hindrance.
The ONLY people that will have issues with the install limit are legitimate users of the game.