g1smd - 6:27 am on Jun 25, 2011 (gmt 0)
I haven't studied what e-Bay do in detail but what I do see is that they leave the full details of an auction up for several months after it has finished (with links to similar live auctions and to the original sellers page and so on) and then e-Bay eventually changes the page content to say the auction has been removed.
I would assume that at some point in that process, the HTTP header status code changes from "200 OK" to either 404 or 410. What we are discussing here is changing it to 410 a few weeks before the page content is changed in preparation for it to be dropped by search engines.
Browsers don't care what the status code is, they will display the HTML content whatever the 2xx, 4xx or 5xx code (with a 3xx code they will follow the redirect to the new URL, not display any content at the originally requested URL).
Searchengines will obey the status code, and therefore not index the actual page content when a 4xx or 5xx code is delivered. They will also take steps to remove the page from their index once a 3xx or 4xx code is returned for that URL.