I know why it got started, but to me ebay encourages and actually begs person to gouge on shipping in order to make anything on the listings starting there. They slap you with a violation for too much on shipping, but they beg you to do it by offering for nothing or in past almost nothing in listing fee. Do they really think someone can sell for 1 cent and offer shipping that covers the cost of envelope, tape, label, packing materials? I do think though that people gouge on shipping do save. However paying 1 cent at auction close and paying 5.00 shipping for a say 2 ounce item, is a little more than I as a buyer or seller can handle. If I happen to buy from someone that does this then DSR I put that. (though I normally stay away from that). If they charged say $2.00 for the item and a little over actual shipping to actually cut shipping they would not save on the ebay listing fee, so it is a cost saving measure. they list for nothing, ship high and that is how they can sell.
Frankly, I think my time is worth more than that. I also think that is ONE of the EXACT reasons ebay quit showing ID's is some people were bidding their items up to make money. I personally reported several people that did this and they were busted by ebay. They were all on items I had bid on, and when I looked back was able to sniff a trail. Now the buyer can't sniff the trail back without a lot of hassle doing it.
I know ebay loves the free shipping, more $$$ in their pocket. I did free for a small amount of time and actually did not find my listings but a space or so above most of the others that charged in their default setting. Some of mine for same exact item showed up when listed one with free and one with charge but same start price. they showed up one right after the other and there were many others listed. Even though they were fresh listings with none previously sold. I think it has to do with person setting, if they have set to best match, high to low, low to high, etc., of course, I am sure ebay has default and most people never change it.
Strategy. . .yep you got it.