This sort of thing still happens today, just in a slightly different way.
If a new song has premiered but hasn’t been released to iTunes yet, you’ll often find session singer covers with knock-off artwork in the store, and that cheapo version will show up when you search for the song in question. There have been cases where the knockoff has actually appeared on the iTunes charts because people were buying it due to the original not being available. This has been going on for years but record companies are only just now (like, in the last few weeks) realising they need to do something about this and are doing what they call “on air, on sale”, which means that as soon as a song premieres, it will be released to digital retailers, so that if people want to pay for it they can and don’t have to download the song illegally. This has the added benefit of making the cheapo versions useless, because iTunes doesn’t allow songs to be discounted, hence the cover is almost always the same price as the superior original.