Hi,
It seems to me that you're proposing something very much like shareware in the software world. If you like a developer's product, you pay for it to encourage further development, etc. It's a good system for many, and one that doesn't work for many more.
There are a couple of issues, I think:
1) How does the author get exposure? Good marketing (even if by the web) is difficult and not cheap. The author has to find a way to find buyers.
2) How does the author control unauthorized copies? It's a very difficult problem and one that kills much good shareware.
Self-distribution works in small niches. For mass exposure, there generally has to be some middleman because there's no way of knowing which new author will be successful. Someone has to pay for the marketing, so the cost has to be higher than if things were done by an individual.
An alternative is something like a not-for-profit cooperative or union or something similar. Like-minded authors would join together to fund a marketing system and gain the benefits of the exposure. But setting up something like this, and running it well is difficult.
As always, TANSTAAFL. :-)
Cheers,
Scott.