Here's an image I love to link to to explain why the way gear works is geared towards trying to coerce the player into using the AH.
http://i.imgur.com/h6OUS.jpg
That doesn't do anything of the sort, though. It simply explains that gear in D3 is essentially crap overall from a gameplay perspective versus how it was in D2.
You are not 'coerced' into buying gear in D3 any more than you were in D2. You could spend weeks upon weeks trying to find a really nice roll for an item in D2 (just as you can in D3), or you could go buy it from someone else on a forum or eBay.
You can spend weeks and weeks farming to get a good roll of an item in D3 (just as you could in D2), or you can go to the AH to buy it from someone else.
The key component that's consistent between both?
Someone had to grind for that item you're buying, whether it was you or not. That's why the AH doesn't matter in the least.
My character's gear was built up of several hundred thousand gold worth of AH purchases and, wait for it, drops that were even better. I've gotten a few rings that are worth tens of millions of gold as best I can tell, on the AH, from drops - not from the AH. There's no way in hell I'd ever manage to raw-farm up the amount of gold people are asking for rings that are better than mine, there's no way in hell I'm paying real money for them and it would still take me a hell of a lot of time to flip items to get the gold for them.
Or, in the process of trying to get the gold via whichever means, a better ring will drop for me. Not for someone else - for me.
I spent years playing Diablo2, and as memory serves, if you didn't buy anything from anyone else, it was still an intense grind just to get items to allow you to survive that step up in difficulty. What people seem to have forgotten since they stopped playing D2 and D3 came out is that nothing has changed in the fundamental gameplay concepts, they're just far less willing and able to do the grinding it takes to get decent gear and are being butthurt, spoiled little brats when they see a piece of gear on someone else's character that they really want, but don't have. The fact that there's the opportunity for them to go out and spend real money to 'get ahead' in a quick, easy and officially supported manner eats away at them the way it annoys Pooky like a fly he can't swat but doesn't want there either.
Ignore it, don't use it, pretend it doesn't exist and there isn't a problem. I'm pretty sure people competing in ladders, when Blizzard finally introduces that for D3, won't be able to use purchased gear to contribute towards their scores, anyway, so it's not like it's a competition to see who can have the best gear - people are currently just trying to get to a point where they can say "I can steamlol Diablo on MP10 inferno difficulty solo". It's a case of bragging rights and bruised pride - and it's sad, pathetic almost, because in D2 and even D1, people were buying gear to one-up their friends as well.