As of this moment, there are 50 people that have clicked 'Watch this item' on eBay.
Even though it is restored (repainted instead of with original cabinet paint) it will likely go even higher. 1930s-1960s EM games (in particular 40s and 50s titles that are fun to play) are a fairly strong part of the market right now.
No, bids were not fake. The machine was worth at least $5k. I heard he actually had 2 of them. I imagine someone just made him an 'off of eBay' offer and the machine might be hand delivered to the chicagoland show this weekend.