It is a bug, it was never intended to gain 100% of your total damage, exactly like any other WoW item, imagine a item that can be used infinite times with 100% of your spelldamage. GG.
And even though it cant be used infinite times, it's still a bug and I see no reason to use this.
It is not fake. This IS useful by the way, 900+ healing and damage on one non-GCD spell can't be bad. Even if it is one time use, this opens up new thoughts... Other lowbie quest items are probably affected in the same way. I will rep you for making me think about other quest items.