I do think the AH ruins finding loot. I mean there is no bind. Which means even if you only get double vendor price it's still worth it to put it on the AH. So you can always find tons of gear for next to nothing.

WoW always had sinks to take stuff out. In this game with no bind, basically all gear stays in forever unless someone wants to vendor it.

This would appear to me to destroy any value in finding loot pre 60.

Unless like monroeski said and you just avoid the AH but that is hard to do when it's there.

I'm only at 30 but without hesitation I vendor all blues without even looking at them. I stacked quite a bit of crafting mats so I don't even bother to convert them anymore.