Yes, ClassiPress has been used for this purpose by other customers, and you can create custom forms which allow the relevant fields for the type of listings you offer. The advanced search functionality also allows your users to search custom fields as determined by you (you can see an example of this search on the
ClassiPress demo site). Other than the initial listing process though where you select categories, there are no other dynamic dropdown menus which would e.g. display a specific list of models based on a make. Location based search is not part of the default theme, so if you're looking to create a separate domain for each e.g. State, you would be able to achieve it with a
WordPress multisite setup and some additional customization. Thanks.