There is a thing called placebo effect. It's well studied and understood. The awareness of having the Litz wire makes you actually hear a difference. And I don't mean you imagine it. They can stick you in an MRI machine and measure your brain signals, and it would show that you actually heard the music differently. 90% of "hearing" (vision too) happens in your brain, not your ears. An audiologist explained this to me once (and I have an interesting story about it if you want to hear it).
And there's nothing wrong with that. Since using that cable truly does make the music sound better to you, then you're kind of right. The only problem with that, is that it's not consistent since it only works for you. It might not work the same way for the next guy. The result cannot be guaranteed by the seller, and therein lies the fraud. He will do an excellent job of convincing you that the cable works. And in fact, at that point, he is already starting to shape your neural pathways so that you do hear that difference.
This is where the ethics get really grey. It's not really the object that is making the sound better. It is your perception of that object. And people will pay thousands of dollars for that perception. It's their money so I don't care, but the remarkable thing is that you can produce that same psychological effect with anything. You're better off buying a magic rock for $1. As long as I can convince you that placing that magical rock in the center of your living room will absorb harmonic energies in the inaudible spectrum, and re-radiate them in tune with your music, thereby adding "thereness" ... if I make you truly believe it, then it will actually sound better to you. For a lot less money. It's a lot easier to sell cable elevators and directional cables to people with a weak scientific background, because logic doesn't get into the way.
The really fascinating thing about placebos, is that even the person knows it's a placebo, it still works to some degree! Even if I tell you that a pain medication is a just a sugar pill, the pain in your knee will still go away! Unfortunately, it works in reverse too. The so called "nocebo". If I tell you that the sugar pill will cause nausea, it probably will. I foresee that in the future, we will use more psychogenics in medecine.