Carfax should just be the first litmus test for a car that you are looking at.
It's kind of like an abort mission button (for those that don't want any issues in a car's history).
If the report is clean, you proceed to the next step (ask for feedback on Prime, personal inspection, inspection by a Prime member, PPI at a dealer, etc).
If the report shows issues, you can abort this one, and move on to the next car.
Keep in mind, that Carfax is not perfect, even in negative reports. There was a thread here from a Prime member who found a discrepancy in the odometer reading on his NSX, and was able to clear it up with Carfax.
However, salvage titles and accident history, I would think, would be unlikely to be screwed up by Carfax.
In summary, Carfax is a good negative test, but not a very good positive test. Never plunk down your hard-earned cash based on just a Carfax report.