This is a loaded question, and it can be answered easily in the affirmative OR a more in-depth answer would leave you with the end result of "maybe". Like anything in life, your personal goals, needs, and financial status will determine what you find "cheap" to be.
Military branches, the Marine Corps in particular, tend to select toughened, off-the-shelf equipment for rapid fielding and quality designs. The Marines have used packs designed by Arc'teryx, Mystery Ranch, Granite Gear, and others as an example instead of designing their own gear from the ground up. This gear is then mass produced by military prime contractors such as Eagle Industries for issuance to troops.
Once this gear is used, it is turned in by the service-member for either re-issuance or auction to the public. Most military field gear is only issued one time as it has an expected lifespan of field usage, and the military cannot afford to have a pack failing on a combat mission as an example. Such failures would cause an annoyance and delay the mission at best, and a catastrophic failure at worst.
Because of this, the answer to this simple question becomes complicated. The purchaser has to find the intersection of PRICE and CONDITION that fulfills their need. Then they need to compare that to other available, non-surplus gear and see which meets their needs the best.
Pictured with this article is an image that depicts some of the conditions you may find surplus gear sold in. It looks rough; however, the condition is actually something that a little elbow grease and soap would not fix. The best part for the buyer is that the surplus company will likely sell this gear for HALF of what a comparable clean item sells for, which presents a bargain for the cost conscious.