Ben, don't go down the rabbit hole of comparing yourself to someone else. Especially when that someone else has ridiculous pricing.
Personally I think taking pictures under the right natural lighting and angles leads to the best pictures. The last ones you posted were absolutely good enough to show what the wood is. I personally don't care about state of the art anything, especially simple photography, when the job gets done just as well for a better price with other methods. The next time I'm in the market I'll be coming to you to try out. That is, unless you show your ass to the world trying to publicly compete with a guy (actually, not even the guy, just his customers) you're already beating just because the customer base hasn't been established yet.
Step back, breathe. Don't worry. Your pictures are good enough now. Make sure your customer service and product offerings are on point. No one can decide how you can accomplish that but you. Just don't get caught up in bickering with people who have no genuine interest in your success or failure, especially when they're immediately showing loyalty to a competitor. Hell, for the prices your competitors charge maybe you should think about contacting them directly and being a source for them. You make money, they make money, and they already have shown theyre willing and able to charge silly prices. No reason for you to NOT try to get in on that by being a direct supplier, especially if the margins for you are the same.
If the wood you supply is good, then all you have to worry about is not fu**ing up publicly. Compete with your competitors' loyal customers and it's a sure loss for you. Let YOUR customers do that for you. Take the high road. Follow Sal Glesser's lead on this one. The only competition you have is your own standard. Everyone else is just noise.
