Trying to understand player behavour with MB & MSQ dungeons

[Espritduo]

By pricing under the merchant price, I can get you to buy that item from me instead of you going to the merchant to buy it. I'm still profiting from the sale.

Except you're not really? You're losing profit by not selling the thing you crafted for below vendor price directly to an NPC. I understand charitable people that just want to help others by listing items below vendor price, but that is literally the only logical reason to do it. If you think you're somehow making more money by selling something below vendor price....I uh...got no words.

EDIT: Re-re-reading your post I think you are confusing the price the NPC is selling the item for the price we sell it back to them. That is what is being referred to here.