Increment Bid vs Maximum Bid

[mmwalzer]

Gixen says the maximum bid must be one full increment higher, but that isn't true. I copied the info below from e-bay.

Can I be outbid by less than a full increment?

You can be outbid by less than a full increment. The winning bid needs only to be higher than the next highest maximum bid by one cent.
Here's an example:

You're the first bidder on a listing where the starting price is $8.50, and you place a maximum bid of $20.00. Your opening bid will be $8.50. When a second bidder places a bid of $9.00, your bid is automatically raised to $9.50.

If a third bidder comes in and bids $20.01, that third bidder becomes the high bidder at $20.01. Since $20.01 is more than $10.00, and is also more than your maximum bid, the third bidder becomes the winning bidder, unless you raise your bid or another bidder enters a higher maximum bid.

[Cupid]

To be accepted by Ebay the bid must be at least 1 increment higher than the current auction price (assuming that is not the opening price when it only has to to be equal to that amount)... that is different from being one increment higher than the next highest bidder, usually you won't know what that actually is until after your bid is placed, it may indeed be only one cent less than your bid.

This is the root of your confusion.

In your example, the third bidder is not be allowed to bid less than 10.00 even though the auction price is only 9.50 at the time he places his bid. As far as that third bidder knows, at the time he places his bid, the maximum bid could be only 9.50 and he might be just about to pay 50 cents over the odds. He might also be upset if he had wanted to pay 9.75 for that item, but Ebay won't let him... that is the rule that Gixen also recognises.
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Mark