The reason I said "it's important to look at the order book" is because otherwise you might enter a market order and expect to get something near the last trade

The reason I said "it's important to look at the order book" is because otherwise you might enter a market order and expect to get something near the last trade price. Which you won't. I do think the "correct price" is near the middle of the spread though. Because this sort of thing happens not just because of illiquidity, but also because everyone involved knows what the "correct" price is. (E.g. because bonds have very predictable cash flows.) There's no difference in opinion large enough to convince a trader to cross the spread.