Most people would expect to get things a little cheaper at an auction. So the rationale would be that "If the prices are this much here, how much are they normally. We're not going to get one they're too expensive."

I don't know about most, but certainly a lot of people think anything on auction is cheap, I used to go to a lot of PC auctions and week after week suckers would pay $50 to $100 more at auction for a pc that they could walk into a store and buy in 5 minutes (with warranty) instead of standing at an auction for an hour.
In my experience popular items are never cheap at auction.