You can I am talking about niche markets here and early odds. I experienced it myself, without doing anything bad. It was just a super value bet (in my eyes), so I placed max bet multiple times in a short period of time and after each bet, the odds went down automatically.

The bookmakers use flagged accounts all the time to help them shape their (early) odds, before they up the general limit. Same reason why SBO changed their policy/limits some time ago, they get cheap information from the sharps that way. But you can't put the limits too low or they are not interested anymore. So your $1-$5 limit is somewhat correct, but the very good books limit their best players just to the point, where they will still stick around. They are very valuable to them.