The picture looks like someone who has more than one of a particular item and wants to get the most out of his auction, not the least.

Let's say you have three of one particular item. If you list all three on Ebay as a dutch auction (you have multiples of the exact item, selling all at the same time) and get three different people each bidding on ONE of your three items, Ebay forces you to sell ALL THREE at the LOWEST of the three high bids. You also pay a listing fee for each of the three items you have, even though you put them all in the listing

However, as a seller, if you list one of these three items and get multiple bids that you are satisfied with, you have the option to make a second chance offer to any other bidder for your auction at their highest bid price. If a seller has three items, this he will usually make a second chance offer to the second highest bidder. This way, the seller gets the most form his multiple items, not a forced lower bid.

There is absolutely nothing unethical about this. You, as the second highest bidder are being offered an oppourtunity to obtain something which you obviously had an initial interest in but were outbid on. You do have every right in the world to refuse that offer for whatever reason and the seller has no reason to call you a deadbeat bidder for that, but that may simply be a misunderstanding on his part.

Me personally, If I had put in a bid on an item that was what I was willing to pay for the item, gotten outbid, then received a second chance offer, I would be thrilled. It means I get the item I wanted at the price I had decided I was willing to pay.