Well.. you can't really compare ebay to your local newspaper ads either. The ads in the paper (for the most part) are for local people selling local items, and there's no buyer protection. Craigslist emulates that, except in an electronic and FREE format.
I do have a recent experience with craigslist, and it was very positive. I sold an old farm tractor that I owned for many years. First, I paid $38 to have it advertised in the local paper for a full 4 weeks (included other smaller community papers as well). I got ZERO responses. I then put it on craigslist and got 3 responses within a few days, and had it sold within a week.
I agree that it's ONE of the things helping to kill the old media, but there are many other things killing it as well.
In that respect, it sounds like a good deal. I've just been looking for an item on eBay with no success and thought maybe I'd strike gold on Craiglist until I found that it only searched Dallas, only searched San Francisco, etc.