Intelligent transport information systems (TIS) are one of the most rapidly emerging applications of wireless vehicular communications using DSRC/WAVE technology. A core function in a TIS is the estimation of traffic density using beacons transmitted by individual vehicles, subsequently used for purposes such as traffic light control or incident detection. In this paper, we conduct an in-depth study on how the accuracy of traffic density estimation depends on various parameters of the wireless beacons transmission policy, such as beaconing rate and timing. Unlike many other studies, our focus is entirely on the application-layer metric of density estimation accuracy, rather than low-layer metrics such as packet loss rate and throughput. Our results are evaluated over a wide range of traffic traces generated by a commercial microscopic traffic simulator (Paramics), corresponding to a typical urban scenario consisting of a signalized intersection of multiple-lane roads.