Definitely not illegal! It's simply called business. Everything you buy from everywhere you buy it is providing a profit to the seller so why take particular offense to someone who buys and sells? I have bought many a guitar from private sellers, spent a little time tidying them up and then re-sold for a small profit. I enjoy the chase and doing the work, it's a hobby that allows me to try out many guitars/basses and make a small amount of pocket money doing so, and if there are particularly nice ones, they might end up in my collection!
If a seller on eBay doesn't put in the effort to take decent photos, create a decent description and doesn't even dust the guitar then they can't expect it to sell for a premium, if I buy it and take the time to clean, repair, dust it etc. then take the time to take good photos and create a good description then it will sell for a better price!
I don't think it's the buyers responsibility to ensure the seller gets top price, otherwise we would never negotiate on car prices, house prices etc. Business is business. If it's a clear and obvious case that the seller REALLY doesn't know what they are selling then it's fair enough to inform them.