Q1: It works from here, and probably from many other locations. However note that geolocation from IP addresses is not a very reliable science. You will be getting the location of your ISP, which can be quite far away, and in addition the IP-to-location databases aren't always up to date with the latest changes, so you might not have any data for a particular IP address -- which is probably what is happening in your case.
MaxMind, which offers a popular IP-to-location database published some statistics on its database:
Q2: The only way to get the geolocation from an IP address through the Google Maps API v3 is by using the same method used in the example you provided. However if you find that any other geolocation database, like MaxMind GeoLite City, is more accurate for your country, you may want to do the geolocation from the IP Addresses yourself, instead of delegating it to Google Maps.
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