It's been happening to me frequently. I'll put a great 4-star recipe on the market and match whatever the lowest price listed is. Sure enough, an hour or so later, 4-5 (or more) new recipes will show up each progressively undercutting the previous one. Before I know it, my listing isn't even on the first page and I'm looking at being out the listing fee which could easily be over 1000+ crowns.
Do you think we should be able to adjust our auction prices without forfeiting the listing fee? I can see losing it if you outright take it down without selling, but what about having the option to adjust the price?
If that happens, you are either pricing your item too high, or you can laugh as undercutters make themselves all of 500cr. Another tip, make sure the recipe you're trying to sell is actually somewhat popular. Trying to sell a Radiant Silvermail recipe is a great way to get burned.
That said, selling recipes is a risky business, so if you can't eat a lost 2-3k listing fee now and then, you're in the wrong profession. Prices fluctuate rapidly, as does demand; I had a Hail Driver recipe that failed to move at 30k, and was snapped up at 33k a few days later when I reposted.