This is definitely working for me so far.
I don't have much time to play so these timeframes would probably be compressed for someone with more time.
I grabbed an alt four weeks ago. I sent him 150g from my main and leveled enchanting through DEs only as I leveled him up to 20. I finished leveling to 20 last weekend and I had about 200g in the bank. The only things I bought were gear so my alt wouldn't get wasted while grinding and questing. Probably less than 10g worth. I blew some money on arcane crystals for my main. I scanned the AH twice a day.
This morning I broke 400g and had about 200g worth sitting in the AH. I login and scan in the morning while I'm getting dressed for work. I do a quick scan for short durations as there is usually good money to be made there. Then I scan much as ohmikeghod did, by level. I resell about 1/4-1/2 of what I win bidding and DE the rest. The only time I buyout is when the lister clearly mispriced the auction and it sells well below HSP. Incidentally, I hold on to those for one day in case the lister realizes the mistake and wants it back.
The only thing I would add for people who haven't watched the AH much is, when you look at the item, see how many times it has been listed. Be leery of items that have only been listed a few times. It doesn't mean that the price isn't right but you could be listing it for way too much (and lose money) or you could be listing for way too little (and lose money).
So, after a month, and leveling an alt from 0 to 225 in enchanting with 150 seed money, I'm going to say this definitely works.