I sold 2 legitimate sites on Flippa earlier this year. One was a Wordpress blog that jus published RSS feeds of deals from commission junction and linkshare. It cost $50 to build and sold for $850, largely because it ranked well for a few long tail keywords and made a few bucks per month. The other was an ebook site that cost $250 to make (including the cost to have the ebook and a dozen blog posts written). I operated the site long enough to break even, then sold it on Flippa for $300.

From my limited experience, I would say that the lower priced auctions (under $2000) seem to be legit, but I have a feeling that the big ticket sites ($5000+) that either don't have verifiable histories (traffic, keywords, revenue) that sell are being sold back and forth between scammers. You can sell a fake site between 2 or 3 scam accounts for $3000, $5000, $7000 at a cost of a few hundred $, then sell it to an unsuspecting person for $10000, pointing to a history of being sold on Flippa as proof that the site is "legit"

For a legitimate site to sell on Flippa for a decent amount, it should have healthy organic traffic, preferably a high page rank, and verifiable revenue. But then the question would be, why would you sell it?