Ofc it was. What was the point of adding any gems to the game but flawless squares? If you use AH you can buy flawless square for 300-500g.
What was the point of adding lowlevel craft system? You can buy better items on AH cheaper than one single craft will cost you.
And the most important argument - DIFFICULTY.
Using AH makes the game so easy that everyone's mom and her dog can beat it.
All monsters around you including elites die from 1-2 aoe hits.
Boss mechanics can be totally ignored. They either die before doing anything or can't do no harm to your enormous HP pool.
Using AH removes the difference between difficulties. On level15 you buy your first red gem to boost your dps to oneshot everything around you for up the end of the nightmare. On lvl45 you buy lvl60 items to oneshot everything up to inferno. On lvl60 your buy full set of gear to make your inferno run a walk in the park.
Without AH hell difficulty can be compared to hell difficulty in d2. A decent difficulty if you don't have a stash of uniques. Inferno difficulty is what was supposed to be after Hell - an insane difficulty that no one but dedicated players can beat.