A few random thoughts on Ebay feedback...
Some context: I run an ebay based small business and have a rating of over 1700 (1891 positives and 4 negatives). I probably do 4 sales for every one purchase that I make. I treat all of my customers like I want to be treated. I take paypal, checks, money orders, etc. I've shipped to 35 different countries and every state. I use USPS Priority Mail with Delivery Confirmation for 99% of my shipments (over 2000 shipments without a single lost or damaged package).
1) I'll buy from people with very little feedback (under 5) as long as they've sold similarly priced items and have 100% positive feedback. This avoids those people who buy a couple of really cheap items to up their rating and then try to defraud folks by selling an expensive item that is less than advertised.
2) I'll buy from people who have 0 feedback. First I check to see if they've won or sold other items, but just haven't gotten feedback (in some cases I'll contact the person that they transacted with to see how the sale went). I'll also only bid if they've included an actual photo of the item (no photos stolen from manufacturer's websites) and seem to have written the ad themselves (first time sellers do not generally have really fancy HTML based listings).
3) I won't buy from sellers whose negative feedbacks follow a pattern. There are a lot of sellers with 100+ ratings (with 95% positive) that exhibit the same bad behaviour over and over (poor packing, late shipping, etc). These users also tend to flame folks who leave negatives (both in giving negative feedback and in responding to feedback).
4) Now for the controversial part.... I NEVER (yes, NEVER!!) leave negative feedback. I know that this violates the spirit of the ebay system, but it does prevent a lot of retaliatory negatives. I will request a refund of the final value fee. I will add the user to my banned bidder list.
5) I pay for as many transactions as possible with paypal. While paypal doesn't give a whole lot of protection, it does allow you to start a dispute. I've started approximately 10 disputes on items that I've purchased and all have been resolved to my satisfaction long before paypal has a chance to start investigating.
6) I respond to every negative comment that I get. All 4 were from sellers that received an item that was not working. I test all items before I ship, but occassionally something happens. Generally, the users contact me about the problem and we resolve it (refund or exchange), but in these 4 cases the user just went the neg. feedback route. In each case, we resolved the issue and that's what I put in the reponse... no flames, no retaliation (I'd much rather see this than 'Buyer was an idiot... Had foot up Ass').
Hope this helps!