The seller did not have much feedback as a seller but had a significant history as a buyer.  The starting price was $1,500 AUD with a Buy it now of $2,500.  Five days out I placed a bid of $1,500, increasing this to $1,712 and again to $1,813 over the next couple of days.  There was no competitive bid until about 40 minutes prior to the auction closing.  See below the bid history.  As you will see the opposing bidder had a zero feedback and had been an ebay member for less than a month.  As the bidding progressed I smelt a rat and said to my wife that I thought I would be getting a second chance offer following the auction.  I stopped bidding at $1960 and sure enough the last 19 minutes was very quiet as the auction ended with me missing out on my dream guitar.

Below are some eBay screenshots of the action and winning bidder stats.  It makes for interesting reading.

I watched my email in tray with interest and within ten minutes as expected came the second chance offer for a Buy it now price of $1,960 (my highest bid of course) as follows:

Message from seller: I feel more inclined to sell to someone who has a feedback rating... feel free to let me know if you're still interested...

I was incredulous at this gall and the haste with which the seller proceeded.  I responded to the seller intemperately suggesting that I suspected a fraud.  There was no further communication from the seller.

Now I understand that a seller will want the best price for a guitar and that $1,500 was a too good to be true price for this guitar but I was still anxious by what had happened.  I went to eBay help, chatted online with someone then Reported the item as a case of shilling.  I had not heard of shilling until mentioned by the ebay help desk chat.  In short it is where a seller or a related party conspires to inflate the bid price.  For a good article on the phenomenon see UK Auction Help.

eBay responded promptly to the report and did follow up with the following outcome:

"Thank you for writing to eBay. I appreciate the chance to assist you
with your shill bidding report for Item ......

I can certainly understand your concern in this matter. eBay is
concerned about violations on the site and I have thoroughly
investigated your report. In accordance with our site policies, I have
found that there is not enough evidence to show that **** has
violated eBay's Shill Bidding policy. I understand your concern about
this situation, and can reopen the investigation if any additional
information can be provided...."

Well that's how things have ended up.  Unfortunately I do not own this guitar, the seller has probably not been sanctioned but I do think eBay were pretty good with their chat support and prompt review of my report. I have bought a few guitars on eBay and what has happened makes me worry about whether I have been bitten in the past.  Beware !

Advice I have received from forumites subsequent to publishing this:

Never bid on an Ebay item until the last few seconds of an auction - use an automated sniping agent to handle it for you. eg. Bidnapper

I used Bidnapper for the first time on 26/6/2011 - posted a 100 GBP maximum bid and won my item for 53.  Very happy with my first trial of this technoloy...