Competitive Pricing

Pricing my handmade jewelry at PinkSunsetJewelryDesigns.artfire.com has been an area of the business that always frustrates me. There are many theories and formulas that have been mentioned on how to price your jewelry creations, or any handmade creation for that matter.
I understand that we all want to make a profit on our items. So we figure in materials, overhead, our time etc. and come up with what we feel is adequate profit for us.  I've heard some say that if you price it too low, you are portraying your creations as "cheap". Still others have said that if you price your items too low, you are doing a disservice to other jewelry making Artisans. Others have said that if you price them too high, they will never sell. I, myself, believe that it is a personal choice. I have been told that my prices are too low for handcrafted jewelry, but nothing gives me greater pleasure that to see someone wearing my jewelry creations. So do I keep them low and watch people around me enjoy wearing my art, or do I raise the prices and let the item collect dust?
There has to be a happy medium. It is said that if you choose to price your items high, it needs to be something unique, that a small number of artisans make. Otherwise, savvy shoppers will opt for the less expensive version of the same item. The area of jewelry making is a very saturated market. It's difficult to create something so unique due to the sheer number of us out here on the web.
So my question is. Do you sell you items at a higher price, yielding a higher return (if you happen t sell it and it doesnt sit on a shelf for a year). Or do you lower your price to be competitive with  other jewelry makers.
I would really like for you to comment, honestly and weigh in on the controversy.