So if I buy a cheap unused nonsense word domain (say wikipedia.org) and turn it into a valuable domain by making a popular website many people visit and link to, 'the network' gets to shake me down because wikipedia.org is worth $20,000,000 now instead of the $20 I paid for it?
And as an end user, I don't know if visiting or e-mailing wikipedia.org will take me to an encyclopedia or a cybersquatter or a porn site?
Who exactly benefits from this system, except for 'the network'?
Not sure what you mean exactly but it works like that :
Once you buy your domain at 20$ is is yours and you do whatever you want with it. The bidding auction applies only the first time you buy it nobody can touch your domain name one you purchased it.
And as an end user, I don't know if visiting or e-mailing wikipedia.org will take me to an encyclopedia or a cybersquatter or a porn site?
Who exactly benefits from this system, except for 'the network'?