It should ALWAYS be a BUYERS market whenever a buyer and a seller meet. eBay, through thier flawed auction process has turned the tables and made it a seller's market and so AS and services like it were created. Sniping simply levels the playing field so that all participants play equally. Because eBay makes a percentage of the auction seller's ending price, eBay has an interest in inflating the seller's price.
Auction sniping causes items to sell lower than they would under eBay's proxy bidding format, for the simple reason that if you place a proxy bid, others are now aware of your interest in the item and can sit there and nibble away at the proxy and drive the cost of the item up and of course eBay's "final value" fees.
eBay hates anything that doesn't make it money, like most bloated corporations. I still remember the days when eBay was a FREE place to list and you could list whatever you wanted and they respected that even offensive items could be listed. Now they have become a sanitized corporation that does its best to make money off you at every turn. Level after level of fees apply to each and every listing. The old days of just trying to make a healthy profit are long gone for the eBay folks.
I expect them to ultimately require sellers to accept PayPal as a condition of selling on their site and eventually they will require PayPal to be the exclusive payment method. There really are only two classes of PayPal users: those who HAVE been screwed by PayPal and those that WILL EVENTUALLY be screwed by PayPal.