Nervous: Let's consider your scenario.
You list a house that should sell for around $500,000 for $650,000. As Keith notes, buyers shop in price ranges. So the people looking at houses in the, say, $625,000-$675,000 price range see yours. And they compare yours to the others in that price range. Your property clearly isn't as good of a value. Their agents tell them that your house appears to be overpriced. For what you're asking, someone can buy substantially more house. They pass yours by.
People looking for houses in the $500,000 range might be looking at houses from $475,000-$525,000. They won't even know that yours exists. And if, somehow, they do notice yours, they'll see that it's priced $150,000 above what they can afford...and $150,000 more than comparable houses are selling for.
You ask about marketing your home as a "motivated seller." In today's market, if I saw a house worth $500,000 listed at $650,000 by a "motivated seller" that would tell me just one thing: That the seller bought at the top of the bubble two years ago and got 100% financing, probably with an ARM. They're motivated because the ARM is adjusting and they can't afford the house. And the house is overpriced because they can't afford to cut the price to less than they owe. I don't know what the market's like where you are, but I see that here (Northern Virginia) a lot. Buyers don't even touch those properties. They wait until they're offered as a short sale. Or, better yet, as REOs.
OK, so you drop your price from $650,000 to $600,000. That's not a huge price drop. Moderate, but not huge. And it's still be $100,000 overpriced. It would still be out of the range that people looking to buy a $500,000 house would be considering. And my additional reaction would be: "Well they must think that that price cut makes them competitive. So now if I make an offer substantially lower they'll scream and yell that they've already cut their price by $50,000."
You wouldn't even be able to attract real estate investors. (Sometimes called "bottom feeders" here, though I strongly disagree with the description.) The way they operate is: They determine ARV (after repair value of the property). They then reduce that number, using a multiplier of 0.65 to 0.7. Then they subtract any needed repairs. So a real estate investor would instantly go to the real value of $500,000, drop that down to about $325,000, then subtract any needed repairs. All houses need something. So your offer from investors would be in the range of $300,000.
Having said all that, I do agree with you that some buyers seem more concerned with "getting a deal" than "getting a value." You see those questions here on Trulia all the time. But that's still a minority of the buyers (I hope!).
So: Price it competitively, at the lower end of the comps. Make sure it looks good. Make sure your agent markets it aggressively. That's your best formula for selling your home quickly for the most money.
Hope that helps.