The only success I've had on any of these freelance sites was by treating them as a marketing sales channel. Didn't lower my prices at all and landed a small project at my normal rate. This served as the start of a more permanent relationship. After the small-time project we got into contact outside the freelancer site and collaborated on larger projects.
The main problem with these sites is not that there's developers bidding at the lowest dollar; those devs are always around, and you're competing against them even when not using the freelance sites. The problem is letting these sites own and monetize your business relationships.
I agree with this, there is the secondary problem whereby people advertising work really don't understand how to price that work. The majority of it that I see is probably budgeted around half of what I would charge.
I think for Junior - Mid / Good exchange rate countries it is a great way to get a toe in the door for future work directly, for anything senior I think you are going to struggle.
The main problem with these sites is not that there's developers bidding at the lowest dollar; those devs are always around, and you're competing against them even when not using the freelance sites. The problem is letting these sites own and monetize your business relationships.