I haven't excluded the GM behavior, I'm just not focusing on it as much as you because I personally didn't find it as wrong as you obviously do. And to be clear I'm rarely a GM so I see things mostly from the player side of things. To me what was described didn't come off as a 'gotcha' that a lot of people here are saying. Most of his players, at one point or another during the gaming session, wasn't paying enough attention to what was going on and that came back to bit them.
Personally I'd have allowed a passive insight against the merchant.