As someone who has used eLance (and is currently) I've found that the price is only a small factor in the quality you'll receive and -surprise surprise- you can weed out most candidates with up front communications before awarding the project. Once we've awarded a project to a developer (or a shop) we aggressively review code and their communication style. We've had good luck with devs at as little as $20/hr and failures with devs and shops (mostly shops) at as high as $75. The real failure is that non-technical people haven't a clue as to how to evaluate the work their receiving and think that they can go from having no relationship to a finished project in a couple of weeks. If I was completely non-technical and didn't have someone in my corner to evaluate my options for me, I would be scared to death- but then again I probably wouldn't know the pitfalls before me either so...
Our big thing is to fail fast. If you're new to us and giving us the heeby jeebies in the first week we'll cut our losses and find someone else.
If you're awarding a project purely to the lowest bidder then I feel you kind of get what you deserve.