It is strange. Games have well defined pricing tiers that players and developers have worked out over time. $3 is generally considered somewhere between "trash you buy as a joke" and "a very short game without much in it". Does anyone know if there's any other markets that work like this? I can't think of any.
Games going on sale at launch also makes me assume its just because no one is buying it, but apparently more people buy games at launch if it says they're on sale. I don't get it.
When I was looking for a mattress recently, I wanted something affordable, but I shied away from really cheap options, because I was afraid they'd be very low quality. Similar reasoning could apply to many things.
Launch sales seem to be pretty standard on Steam, you can only set it up before the release and you can't change it afterwards AFAIK.
Err... most things. Furniture for example.