[sobos]

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Maybe this villain hit a stretch of good cards and is really a 40/.5. Why do you assume (unless you know the hands he's played) that he's really looser, not tighter, than 2?

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Because there's a lot more people who raise 4% of their hands than .01% of their hands. Regression towards the mean, or something? It's the same reason someone running at 8PTBB/100 over 25K hands is more likely to be a break even player than a 16PTBB/100 poker god (I'm not saying OP is a break even player, just that he's more likely to be running hot than cold).

As an exercise in the usefulness of sample size, try the following: Play 10 100 hand sessions (either multitabling or in series). Look at your stats from each session. I run about 14/10 most of the time. Playing ten tables, a few were in that ballpark, some were more like 12/8 or 17/15, one table was 24/20, and one was 5/0. 5/0! That was over 95 hands. Actually, just forget the exercise and go back and look at 100 hand samples of your own play. The results may surprise you.

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I think that villain's PRF range is 2% + a certain standard deviation that depends on the sample size. The deviation will be large since the sample size is small. So yes, it's more likely that villain's range is 3% than 1%, but it is not more likely (ignoring all other factors like the fact that he's a 40 VPIP) that his PRF range is >2 than <2.