Having to slash the prices so drastically is also embarrassing and doesn't build hype the way the tickets being instantly sold out everywhere does.

There is nothing embarrassing about a Dutch auction. What's the point of generating hype by selling out tickets? All of the tickets get sold out either way, it's just that now more fans end up with tickets instead of scalpers.

The next location or tour people are highly incentivized to snap up the tickets as soon as possible rather than waiting. This can't be the first you've heard of such a strategy.

If it sells out either way, then you will want to buy it before it sells out in both scenarios. It's just in the action scenario you can be sure you will get a ticket.

Buyers do not behave rationally. Without the induced sense of urgency some portion of buyers are going to think better of the purchase. So there is a risk it will not sell out either way.