Yeah, I couldn't part with my Blizzard 1260 either, it still makes the machine feel "modern" in use. But if you look at the classic market, the majority of people buying new hardware are generally looking for WHDLoad-class machines, and when that's the case they probably won't be playing many games that benefit from faster than an 030.
The problem of reputation being tarnished by some people being incompetent or trying to use fake CPUs is made more of an issue by how small the market is. You just have to look at threads where people ask what X or Y retailer/developer is like, and there'll be plenty of people to volunteer stories of bad experiences. If you look at these enough, you start to see that it's usually the exact same story being trotted out again and again, magnifying the small issue that there was into something that can seem rampant. So, even if you get one person who physically broke their chip because they didn't have the right tools (I've seen this done with PGA chips before!), that same story will show up everywhere because everyone likes to propagate tales of woe.
Given the smaller market and the higher risk involved, I'm not sure I'd bother either.