To answer your last question, before placing a bid, get the receiver's serial # and card # (one begins with R00 and the other begins with S00) from the seller. Give Dish customer service a call and ask them to check those ##'s to confirm there is no balance due, and the account has been closed. If the answers are no balance due and account closed, ask the service rep to confirm Dish will activate that receiver to your account if/when you purchase it.
Don't believe any seller who refuses to provide the ##'s but assures you the unit is free and clear. Some people think the receiver is theirs to sell because the ad they responded to a few months back said FREE equipment, FREE installation, etc. It all depends on the terms of the contract they signed.
I purchased my receiver on eBay, and did get a legitimate unit at a great price, but would've been screwed if I hadn't called Dish with the ##'s of every receiver I considered buying. According to at least a couple reps I spoke with, if I did buy a receiver with a balance due, they probably would activate the unit to my account if I paid the balance. But, if the previous user didn't close the account, you're still dead in the water.
Check out any of those dealer links at the top of this page if you prefer not to go the auction route.