I buy quite frequently from ebay, and I have, in the past, purchased a guitar from them. I was quite happy with it, and I figure I got a great deal. As a matter of fact, JAB, I was following that Lyon and Healy open back with great interest; it looks like a fine instrument. I believe that I spotted the Gibson as a phony. There are ways to go through escrow with high-ticket items such as musical instruments. I forgot--I also bought a long-neck banjo on ebay a year or so ago, and I've been happy with it, although I probably will not use it onstage.

Now-- to the music store thing. I have never bought an instrument from a music store, but I do believe that cultivating a relationship with a good local store is important (and economical). The store I use gives me a discount as a professional, and they will let me rent a piece of sound equipment for a special gig or a mixing board if I'm doing a multi-track thing where I play all the instruments in an arrangement. They used to sell us strings in bulk when we were a road-band, and they have provided us with many courtesies. On the other hand, if they don't give you some consideration as a regular customer, find a store which will do so.