I "snipe" items all the time, sometimes it's the only way to make sure you get something at a reasonable price. It's been done to me before so I know how frustrating it is to lose something you really wanted in the last minute, but such is life. If you're the seller, you can't say you don't know how much interest is in your item because of the watch lists-- ebay shows you exactly how many people are currently watching your item at any time on the My Ebay page.

Look, I don't know if you've noticed this, but there are a lot of crazy fools with credit cards bidding on items on ebay. :) They will overpay on an item seemingly just for the hell of it, but most likely just because they either actually are crazy or just got caught up in the thrill of the auction. When I'm selling something, I count on those fools, when I'm buying something, I fear them. People that run up a bid several days before the auction ends just ruin the deals, I'd much rather they wait until near the end.