The whole game is build around auction house imo. The loot itself is tied to AH in some twisted way. Before D3 was released it was not so apparent that the game was designed with consoles in mind. But the moment you boot into D3 and its simplified mechanics (4 buttons 4 abilities), reduced mob density (limited rams on consoles) and restricted player customization just shows it was made for console crowd in mind.
Granted it is Blizzard's most weakest game ever, is still an enjoyable experience. AH atleast for me is the catalyst to play this game as I can gather enough money to get a loot of my specific liking and change my playstyle to it. Now if you remove that portion of the game, where is the replayablity? That is effectively reducing the value of game to half.