There's no point putting 'untested'
It will lead to
1- fewer buyers
2- if is faulty you'll have to refund anyway
I guess it depends on the item(s) really. For instance, the Wife and I sell a lot of old Hornby and Wrenn Railways items on eBay - I don't have the facilities or skills to test and service these items; so I will often list them as untested, but make sure that I describe how the items have been stored for several decades - at least a buyer will then know what they are getting.
My father in law used to test some of the items for us on a basic strip of track (forward and reverse), the listing would go up saying "runs well in both directions" or the like; but we had a few instances where the buyer received it - it had either stopped working by then, or didn't run as well as they wanted. That just opened up a can of worms, so we opted to simply list the items as untested, with a lot of text stressing the item had been unused and stored for many years. Now we get zero hassles for returns/partial refunds.
eBay is a funny place at times - I'm fairly certain I read somewhere, either their forums or a 'help' page; that you cannot actually put a disclaimer on an item. Which makes listing older things like said locos, a bit of a pain at times - I have to stress in numerous places on the advert that these things are old, unused, untested and that the photos will offer the best description (a cover all attempt) - but I also offer people the option to contact us for more photos to help clarify any condition or markings etc.
The Wife is flogging an iPad on there at the moment - I was dreading listing that, as it's the first bit of tech we've sold on the site; just hoping we don't end up falling for a scam.