The problem with the eBay model is the weird combination of transparency and opacity added to idiot users.

Basically, the problem comes when you bid your maximum amount early in the auction, then, later, some idiot comes by and submits a bid, sees he's not winning, submits another, still not winning, submits another, ad nauseum. This drives up the selling price. But you say "this is no different than if he'd just bid that maximum amount to begin with", but you're forgetting the fact that he's an idiot who will bid more than he wants to pay just to win. If there was no feedback until the auction was over, or if you could see everyone's max bid, this problem wouldn't happen. (The latter would cause other problems, though, which would be similar and worse.)

This is the reason that people snipe. If you submit your bid at the last second, no one has the opportunity to creep up on you. Which turns eBay's system into a sealed-bid auction. Which makes you wonder why they don't just make it sealed bid anyway. Other than the fact that their system plus those idiot users (combined with the non-idiots who haven't figured all this out yet) raises selling prices.