As long term Ebayers, we list a lot of items in no reserve auctions with very low starts (all our auctions start at 99p, no matter how big the lot!). Some sellers use the starting price as the price they will accept, others elect for low starts. As we only handle clearance and liquidation stocks, we will let market forces decide the price, i.e. sell it to the highest bidder.
For example, if we are selling 100 pairs of jeans we will offer them at a starting price of 99p for all 100 pairs. They could finish at 99p for the 100, so someone's got a bargain and we've got a few more grey hairs. If a few people are interested the price will inevitably go up, but there's still every likelihood of a genuine bargain.We've had quite a few lots in the past slip through at a sold price of 99p, and had some good prices for others. However we differ quite a lot from other Ebayers, as we have to clear the stock we sell, so highest bidder gets it.
Don't be afraid to put in a decent first bid, this may deter someone from outbidding you, if they only put in a low first bid. So on the above example, if you bid say £30 and someone kept getting outbid when bidding £2, £4, £6, etc, against you, they may get fed up and look elsewhere.
Also check out the postage, some sellers offer low start auctions and have inflated postage (we don't, but then we know we're honest, you don't unless you've dealt with us previously). Also check out feedback. Then check out sellers other items and any completed lots that have been sold recently. Click on 'Advanced Search' at top of page next to search box, you can then do a completed listings search). If you do bid on a lot don't get carried away, have a price you are willing to go to and stick to it.
Be wary of shill bidding (when a seller has another user id, or a friend to bid against you), its against Ebay rules and quite easy to spot, especially if the seller has a few lots running. This can be reported to Ebay.
If you bid on an item it may be that you get outbid immediately this is probably not underhand, merely that the previous bidder has placed a bid higher than the bid you placed.
Don't get carried away with auction fever, never pay more than you are willing to, there's lots of bargains to be had by auctions, just be careful out there... Oh and try to have fun no matter what you do......