You are often best to start any auction at 0.99p and there has been work done to show that when you do this the final price is up to 30% more than if you set a reserve. I have done this with both cars and motorbikes on eBay with good results.
I've also noticed this. I think it's down to the fact that ebay shows the number of bidders, the higher the number the more people seem to think that the item is a good buy, that and you get a few stubborn bidders hooked right from the start with the low price eventually driving it up for you. Bit like trading really.