As a confirmed Shelfarian, I know of two approaches to awarding up to 5 stars to a book: the "Critic" approach and the "Booster" approach.
The Critic says * is a mark of distinction an author has to earn; ** is for going above and beyond the reader's expectations; *** is for blowing the reader's mind; **** is for changing the world for the better; and ***** is for bringing about the millennial kingdom of God by the sheer power of the written word. Most books will have only one or two stars, and authors will have to fight hard for more than that. A critic who regularly gives out a lot of stars will often be read as over-generous, soft, or indulgent; yet, on the other hand, a truly obnoxious book simply cannot be rated at all, dropping off the scale with a zero-star rating that, ironically, has no effect on the book's average, as though it hadn't been scored at all.
For the Booster, however, ***** is a book that meets all expectations of reading pleasure. **** means there were a few off-moments, but overall the book is very good. *** means the book is all right, but it has serious problems. ** means it's not the reviewer's cup of tea. * means that the memory of this book rankles, like the taste of sickness, long after one has gotten over it. Ironically, although the Booster's 5-star scale has more scope for measuring the badness of a bad book, Critics will accuse Boosters of throwing softballs because most books on his Shelfari shelf have 4 or 5 stars; the ones that are really exceptional are tagged as "favorites."
I'll be up front about it, I'm a book booster. Because of my affiliation with MuggleNet, I am particularly a children's & young adults' book boster. I don't write critical reviews (though I don't withhold honest criticism either). I recommend books that I have enjoyed, hoping others (especially children) will read them & share my enjoyment.
Ironically, I have also been accused of "book censorship" because my book reviews routinely include "adult content advisories," "occult" ditto, and other hazard warnings where Christian parents may be concerned (such as books that promote the theory of evolution, anti-Christian polemics, disturbing ethical values, etc.). But my intent is never to discourage people from reading them; rather, these advisories are a "heads up" to Christian parents who are engaged in their children's inner lives, to be prepared to discuss things that may challenge the values they are trying to form. Banning, forbidding, or refusing to look at something is never the right response to "off-message" content. Children (and adults) should be encouraged to experience everything, apply critical thinking skills & discuss what they are reading openly and intelligently.