Gearing and drop rates, AH use almost required to progress.

[Concillian]

I think that the intended use of the AH was as a mechanism to make trading significantly easier than it was in D2.

In D2 you could reach plateaus in your gearing (especially at the end of nightmare difficulty) where you wanted to stay and farm where you were a while. Right before the Maggot Lair in hell diff, for example, you might want to make sure you have a fair bit of poison resist. You may actually end up framing the end of Act I a while if you wanted to do that.

With the AH there, people don't stop and farm. They just go to the AH, and there it is buy, done, bam. The convenience factor is so high that people don't even consider stopping and farming a few levels for some gear. The result is that you end up somewhere that you maybe don't belong for either your level, gear, skill or all three. I don't think there should be shame in repeating areas a few times to get some levels or gear or mats for crafting, but a lot of people think that the game should be played straight through. I'm 100% certain that the developer intention was not for you to finish Act IV hell and step straight into Inferno. How long they expected you to stop and farm in Hell is debatable, but I'm certain that they intended you to farm in Hell difficulty for some time before entering inferno.

The thing about gearing in Diablo games is that very little of it is tied to the level of the gear itself.
Similar to what Lochnar said, Mostly it's tied to the affix rolls, which is just a numbers game. Eventually you'll get a good roll, so you need to try a LOT of times in order to get that good roll of just the right stats.

The other thing is that Diablo III seems significantly easier with some defensive stat focus & builds that don't rely exclusively on kiting / avoiding as their defense. However, it seems that many players don't really like this approach. There seems a strong tendency for people to go full offense and then they end up dying a lot. Until inferno, it's easy to go to the AH, grab a big DPS upgrade and continue on destroying things with a full offensive build. Then the brick wall hits in inferno when this is no longer feasible (either for lack of any DPS upgrades, or for lack of gold because those upgrades are too expensive).

I think it's a player mindset vs. developer intent kind of thing. There was clearly a disconnect between the two at launch, and the blame for that can't fall on the players. You can't make the players do something they don't want to and feel happy about it. From the comments I've seen of their playtestting, it seems like they sided heavily on the casual one-time through players and not heavily enough on the players that would sustain the game long term.