Is it true that if you have your welcome page as a static first page that it counts hits for everyone who happens on your website, but if your first page is just your latest blog it will only count hits if people actually CLICK on a link? Is this how wordpress counts because I notice a huge change in stats when I switch between the two
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Welcome page and hits
No, it's not true. When you switch to a static front page, Google and Technorati throw you down to the bottom of the standings, though.
When people come to your blog and it's the dynamic blog page up front, they count as one hit. Same with the static page. But with the static page, they then click either to the blog page or to individual entries, and it's this diversion to individual entries that will cause your clicks to go up. Because they can't read the blog all at once, but have to go one by one. You'll also lose a considerable number of people who can't be bothered to click more than once, or really want it displayed in blog format but just can't find the button.
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