I just stayed at the Intercontinental on Chopin Plaza, Miami for $90 per night, obtained on Priceline. I bid for 4* stars, downtown Miami. I knew from checking those sites which hotel in each map grid was 4* and bid accordingly.
The online rate was $279 for the time I was there.
It was a beautiful room with a view over Biscayne Bay. When I checked in they asked me what my choice of location was and put me where I wanted.
Every time I have used Priceline I have selected 4* so that does assure you a certain high quality hotel.
errm- of course they are selling rooms that are not already booked.....
Yes, the person who uses these sites is looking for the best bargain...
Priceline and Hotwire etc have a huge network of hotels. It is up to you to do your homework by looking at maps and checking the bidding sites to find out what area and star rating to bid to get the hotel you want. Some people have it down to a fine art and it is far from the "leftover" scenario you describe. There are real-time updates as to what bids are being accepted.