Unless you are talking about profit sharing, you would probably offer the lowest amount that you knew you could get away with so that your chances of flipping a profit is maximized.
There is nothing right / wrong about this. It is just human nature / market dynamics. Companies do it all the time when they hire us.
That is not human nature. That is avarice. Your intuition that "everybody does it" does not make it right.
No, in fact, I would not. If I were a dealer in such things, I would offer a fair amount that lets me make money and isn't an insult to the seller like $16K is. Given that something like this probably has to be sold at auction, I would guess $400-500K would be probably the minimum fair offer that takes into account seller's fees and the uncertainty as to how much the thing will sell for, while still protecting the former owner's interest. In any case, I would certainly offer a large multiple of $16K. And, if I couldn't swing that kind of offer, I'd be pointing the seller to someone who can.