As above; it’s more complex than that. Eternally selling only the cheapest item per unit price can result in market instability.
Previously you might say to yourself “I need 30 [Deep Sea Satin]” and go to the Auction House. There might be 30 individual [Deep Sea Satin] that are all “the cheapest” per unit, but that was dreadfully annoying and I’m glad it went away. A lot of people might, instead, pay a slightly higher amount per unit to buy a single stack of 30.
Because the unit price isn’t static it can be a better deal with buy precisely 30 items, even if the cost is higher per unit, than buying a 200 stack.
The new Auction House, obviously, shattered the old model. We can no longer sell in stacks and offer “bargains” (say, 1.5g per unit in stacks of 5, 2g per unit individually, and 1g per unit in stacks of 20). This might seem great to the average user, you don’t have to think about prices at all now, but essentially the entire auction house is now stacks of 1 and you can’t ever get lucky and buy up a stack of 20 for slightly lower than market value.
Essentially there’s no such thing a stack value anymore. You can’t price items based on their stack sizes, so there’s no incentive to try to create a range of prices. Only the cheapest items will sell, and they’re always handled as stacks of one behind the scenes.
Which, if you understand the system, can cause the cheapest price to get lower. People will still undercut, but now only those people are going to get sold. Even better, of course, because when they post at the cheaper price they are now the preferred auction. The system sells off items that were posted more recently first, so the undercutters selling right now are the ones driving the market.
Essentially anyone sitting on, say, twice the market value (hoping, perhaps, that overnight someone will buy it for convenience) is essentially removed from the playing field. You become more and more handicapped the longer your auction sits there; as more people move into the queue in front of you they take priority.
Imagine that you went to Burger King to buy a burger. Then someone else comes in and puts in an order. First In; Last Out. Everyone who comes in after you is prioritized more and more until you leave and go somewhere that doesn’t work that way. If you’re not serviced relatively quickly you’re odds of getting that burger become lower and lower until they reach a theoretical floor of “never”.