I'm a huge fan of pay what you want idea, of course it doesn't always go that well with some games, however I like to think that it really helps some out. It's usually for indie games of course, but it also creates a window for some people to donate large amounts of money that some indies may never get normally.
Of course it all depends on advertising as well and Wolfire's Humble Indie bundles do a good job about it as everyone will pass on the word in person, via Facebook or of course twitter.
It's also great as they will usually offer versions of games compatible with Windows/Linux/OSX to cater for all needs, while also giving you keys to active the games on Steam. While supporting gaming based charities, hosting costs and of course the developers. Perhaps I'm being selfish but when I pay for a humble bundle I'll always change the ratio so that the developers benefit more, as well as the hosting costs above the charities...does this make me a bad person? The charities always get money too with the ratio breakdown I go with, just I feel some of the developers could really do with the money.
Of course most may pay the least amount possible, however there will occasionally be incentives to give you more games, should you donate more, making the average price paid per bundle a lot higher. I usually try and pay what I feel is adequate for what I'd be getting, so I never really pay the minimum or the average, usually above average.
Lots of developers have also tried the scheme for their games, either for a trial period or for a special occasion, such as 2D Boy when they did a pay-what-you-want for World of Goo or Joost Van Dongen with Proun and have had mixed results, but sadly like a lot of things in the world it's all dependent on marketing budgets at the end of the day.
Radiohead did alright with their sales of In Rainbows back in 2007 which had a similar pay-what-you-want scheme, but they had a fairly substantial fanbase, whereas for an indie you need to build something like that up over time, Radiohead had already had six albums worth of marketing. As well as every website and newspaper at the time talking about how crazy they were for doing the scheme. Plus of course their website was so swamped with traffic of people either paying the lower 1p or more dependent on if they wanted the disc version, that the website went down.
Now if only the same could happen for some indie games that'd be great, except of course for servers going down from excessive traffic.