I heard somewhere that these way overly-priced items are often used as a way to hide illicit transactions.
Or smartasses like me that get told to ditch a drop-ship item because the distributor is a PITA to deal with. Instead, I just jacked the price up to $999.99 on a ~$400 item and figured I'd deal with the distributor myself and split the excess profit with the boss. Then we actually sold one. Boss was fine with it. I learned a whole new definition of PITA, but left it for a while longer just in case.