This is a nice idea, but I liked the fact that players could see what others bet: this could have increased competition when trying to outbid each others.

My hope was that people would start out small, but then place higher and higher bids to try to win the bids from others -and- not lose what they've bid so far.

I think the best way would to have no fixed end time: something like if there are no transactions in the last half hour, the highest bidder wins.
Or use generated blocks, like, everyone has to bid before the initial deposit has x confirmations. This could work nicely since new blocks aren't that predictable.

But the trust issue will stay there