It's true that on Ebay a lot of people pay way over the top. They are the amateurs who get caught up in the bidding frenzy.
I therefore never bid for anything unless I snipe it, e.g.
http://www.esnipe.com in the last few seconds of an auction. To bid any earlier just attracts attention, and causes one of the novices to up their own bid, and while they end up paying OTT the bottom line is that you don't get what you wanted.
It's no good letting Ebay do the bidding, because Ebay submits the bid right away, to the extent necessary to outbid the current highest bid. So your hand is shown straight away.
Ebay is good for disposing of all kinds of old IT or camera junk. One gets about 50% of the brand new price.
As for buying new stuff, again it is usually a fallacy that Ebay is cheaper. I bought an HP 4700 PDA recently, at a price way below anything on the UK street. BUT the item came from the USA and the discount was entirely due to
a) taking a chance on UK Customs not charging VAT
b) taking a chance on UK Customs not charging import duty
c) taking a chance on the courier (e.g. Fedex) not making a further surcharge
Of course there is NO real warranty on most items.
But you can buy an Emtac GPS on there for 60 quid, whereas Transair sell the exact same thing for 200 quid, and it's really easy to buy and pay with paypal.