I use stars in my auto-playlists all the time and extensively and it appears to work fine.
If I click three stars in the interface to rate a song, tag inspector shows a 60 rating.
The one issue is in auto-playlists is that in some instances it shows the graphical stars and in some instances it shows the numerical ratings. This appears to be a visual problem rather than an operational one, because it seems to work correctly either way, and if you look in the *.xautopf file for the playlist the proper numerical values are listed there no matter how it's displayed in the GUI.
It may be relevant that I store ratings in my files, not in the database. OP doesn't mention how the ratings are being stored.
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