The scam is that you buy something totally worthless off them (thus kepping
it legal - barely)and get your name placed in a matrix with a bunch of other
suckers.  You're absolutely right about it being a variation on the old
pyramid selling scam.

Here is a hypothetical scam.  Read this, then read the product description
for the item you quoted:

Advertisement: "Send me $100 for information about how to get a new Hyundai
(MSRP $9,995) for only $100!"

You send this bastard $100 because you are stupid, and he sends you back the
valuable information: "To get your Hyundai for $100, just get 100 other
dumbasses to buy the same $100 information too and I will sell you the car
for $100."  Then your former friends also get the same letter, instructing
them to each find 100 of their own suckers.  Do the math--the absolute worst
that can happen to the seller is he has to sell you a car for $205 over
MSRP.  But more likely your friends will continue the pyramid to some extent
and send him third generation suckers (but not enough to buy a car, just
more free money), OR you won't make it to 100 second generation suckers and
the "seller" gets somewhere between $100 and $10,000 for free, no car sold.

And that's assuming the seller follows his own rules instead of grabbing
everyone's money and running off to south america.

Did you report it to Ebay so they can remove it ?

Yes, they are frauds. Pyramid frauds.

Report them through this page:
http://pages.ebay.com/help/contact_inline/report_listing.html

1- Listing violation
2- Listing policy violations
3- Listed a raffle or lottery

Contact support: Email

On the form that follows you can list 10 auctions by reference number (top
right corner of auction page).
(After "Send" you can click backpage to send the next batch of 10).

The easiest way to do this is have two browsser windows open: one with the
auctions, one with the email form.

JaF