The following points are things that I have learnt through buying and selling guitars on eBay in the UK. Hope it is of some use to others.
1. Research the guitar you want to bid on and find out the 'going rate' for a similar guitar. Use the eBay 'completed listings' search facility for this. Don't overbid!
If bidding on a new guitar, try searching retail web sites for their lowest price (including european/overseas music stores). I have bought several guitars in Euros for less than 'Buy it Now' UK eBay prices! Remember that if you live in the UK, you may be charged import duty if purchasing from the USA (approx. 20%). European eBay shops will often include UK VAT - check if VAT is included in the quoted price.
The reason for this is NOT so that you don't pay too much, but so that if you want to sell it again, you can afford to buy another one!
Good, well known makes will always retain their second hand value better than 'cheaper' makes. However, you can get some good bargains by buying cheap guitars and setting them up yourself.
Check Harmony-Central for user reviews of the guitar model you are interested in. Be aware that sometimes one of the reviews may have been written by the seller and that this review may paint a rosy picture!
Don't make the mistake of just looking at 'Auction' listings. Look for new 'Buy it Now' listings - sometimes you can pick up a bargain before someone else snaps it up! I have saved at least £200 on standard eBay 'Auction' end prices by snapping up such items!
2. Study the sellers feedback ratings and adverts carefully. Do they actually state the exact make, model, condition (scratches, dings), age and serial number. If not then ask! Also ask about playability, fret wear, action, setup and any string buzzes or rattles, are the electrics OK and how does it sound. Also ask for a 14-day money back period in case you find a problem, e.g. they said the electrics were OK and a pickup does not work.
Check the serial number with the original manufacturer. You can then email the manufacturer or check their website for the meanings of their serial numbers. Does their quoted serial number match the type and year quoted by the seller?
3. Are the pictures of the actual guitar for sale? If not ask for them for actual photos. Beware of fuzzy or small photos, there is no excuse for poor quality photos when digital cameras can be bought or borrowed easily.
4. What is their reason for selling? Did they buy it on eBay recently? Check any eBay items they bought recently to see if it is listed. If so, why are they selling it so quickly - ask them?
5. If the guitar is valuable then ask for insurance. Be careful to check that guitars will be covered by the insurance though - some types of insurance do not cover musical instruments! Ask the seller to photograph the guitar on top of the packaging/bubble wrap prior to packing. This proves that the guitar was sent in one piece and makes it easier to claim on the insurance, if required.
6. If they are sending the guitar without a hard case, ask them to double-pack it using a large outer box as well as the normal box and use plenty of bubble-wrap. Strings should be slackened before shipping. At the least, ask them to use two heavy duty cardboard tubes (top and bottom of the neck) taped tightly with a single layer of bubble-wrap underneath. The head should be very well protected as any drop on the head end will usually snap the neck unless well protected using bubble wrap. The whole guitar should then be wrapped in more sheets of bubble-wrap and packed tightly into the first box. All ends and sides must be well protected. Use more bubble-wrap or air bags between the outer box and inner box.
7. 'Pick-up only' adverts often end with lower prices than other similar ads. However, if you check with the seller, you can arrange for the parcel to be collected. Many couriers will pick-up from a house and then send it via UPS/DHL etc. You can arrange this yourself if you know the pickup address and time, or you can provide the seller with your couriers phone number or web site and let them arrange it for an agreed extra cost (including packaging).
8. If you are ordering from overseas, don't forget that there is a time limit after which you cannot claim compensation from PayPal. Always email the overseas buyer first just to check that they can respond to emails quickly.
9. When you receive the parcel, do NOT sign for it until you have unpacked and examined the guitar first - make the courier wait until you have checked!. Once you sign, you forfeit any insurance claim! If the guitar is damaged, then photograph it immediately and contact the seller and then make a claim on the insurance.
10. Once you receive your guitar, keep it in good condition. A guitar with little or no marks is much easier to re-sell, and you may get negative feedback if you fail to mention any marks which you think are trivial but the buyer does not! Always use a guitar stand or case and clean the strings and bridge after every playing session to remove acidic sweat. Print-off the eBay ad so that you can accurately describe it on eBay if you want to sell it later (and cut and paste the description to a text file for later use).
11. If selling on eBay, remember that all the points above need to be mentioned in your ad! Always say '14 day money-back guarantee if you find the guitar not as described' or similar. This instills confidence in the bidder and will get you a better price! Similarly be positive not negative - saying things like 'no time wasters' etc. will not stop the scammers but it does put off the honest bidders.
Don't let the above put you off, these are just sensible precautions. eBay is a great place to buy and sell guitars - take care though - it's easy to end up as a collector - I know :-)