Competition is a big factor too. At the flea markets, you are probably the only one selling a portable audio device, whereas on eBay, buyers can choose between non-brand MP4s or the big brand names. Unfortunately for you, brand names have the cool factor - at this stage anyway.
I suggest continuing to sell offline at flea markets, you should also try listing in free newspapers too.
If you want to sell online, try placing classified ads on Craigs list, or best of all, developing your own website. Your own website will mean you aren't easily comparable to competition, and you can be fully in control of marketing your MP4s as a cheaper with excellent functionality etc.