I can't help you, but I can support your points.
I can't imagine anyone would want to hide their items from their customers (duh?!) but if you have lots of similar items it is good to be able to stop most of them from appearing in the scrolling window and looking boring.
I only want to use the gallery window, I have an eBay store and I want my customers to go there to view my items. No offence to Auctiva, but their store layout is pretty ugly and confusing for buyers who are still struggling to get their head around the concept of a store.
What you can do is to customise your window so that the 'see all my items' link (or whatever it is) is the same colour as the strip - so it effectively disappears. The search box will still be there, which will open results in Auctiva. You can hide the search text and button using the same camouflage techniques, but you are still left with the white text box (except that now people won't know what it is or what to click).