The only issue I have with the AH is having both the RMAH and Gold auction house exist.
I say this because, most of the items I would love to obtain gold and buy with are on the RMAH. More and More better items are appearing on the RMAH over the GAH
I think it varies item to item. When I was buying a String of Ears not long ago, I found a lot more reasonably priced high-end ones on the GAH and that's where I ended up buying it for about 8M.
On the other hand, the Justice Lantern I just picked up a day or two ago I found on the RMAH.
Currently I'm looking for a shield and while they come and go, there's usually about equal selection on both AHs. I don't think either one is particularly better than the other.
Loot in D2 was equally random as D3.
Inferno is like Uber Tristram or Diablo Clone (both are D2 content that most people never did because they were actually difficult [unlike D2 on the whole] both in reaching and in completing); it is that accessory difficulty level that simply is not intended for everyone and requires you to prepare for it and approach it as such. If you are dying so much that you're dropping hundreds of thousands in repair bills, you're getting ahead of yourself.
The first time I cleared A1 Inferno I got wrecked in A2, the first time I cleared A2 inferno I got wrecked in A3, once I cleared A3 I hit a major wall at Rakanoth, once I beat Rakanoth it took me about 2 hours and numerous attempts to down Diablo after modifying both my gear and my build.
Each time I went back to previous countent, farmed, re-tooled my build, and scoured the AH for upgrades (Yes, I would say if you want to beat Inferno you should be using the AH. If you don't want to use the AH, that's fine, but it only furthers the idea that Inferno is not for everyone.) and slowly progressed. That's the name of the game.
One outlier does not prove a point.
I feel compelled to remind you that your entire D2 experience is pretty much an outlier.