I am not a flipper per se, but I have bought and sold several bikes on Craigslist. I generally buy a bike, clean it, tune it and ride it. If I want to keep it, it stays in the garage. If it just isn't right for me, I sell it. I don't buy a bike with the intention of immediately flipping it.
By doing this I have learned how to fix bikes, learned about all sorts of components, and provide a service to other buyers in that I buy bikes that "need help" and get them road worthy. I don't end up making much, just enough to buy the next bike.
One of the things this has allowed me to do is to keep upgrading my collection. I started out with a Giant Yukon mountain bike (which I still have) and went through a Peugeot, Miyata, Schwinn PDG 30, Raleigh Olympian, Bridgestone Kabuki, etc, etc.
Along the way I've kept a near-mint Schwinn World Sport from '89, a Schwinn Le Tour '74, a Schwinn Le Tour Luxe '85, a Raleigh Technium 460, a Gary Fisher Super AR road bike and another Bridgestone Kabuki Submariner which I'm currently trying to sell. All the others are going to stay around awhile.
I agree that it can be an issue, but I think that I have benefitted the buyers of bikes that I've sold by completely cleaning them, touching up paint, replacing worn cables and housing, rewrapping bars, etc. When they buy a bike from me it looks pretty close to new.