> do pedestrians and other drivers really make "eye contact" with drivers to gauge their intention?
I certainly do - most commonly when merging into a congested lane from a side street, stopping and making eye contact helps understand if everybody is paying attention (the merger can move forward and the merged is leaving a space open for them).
Body language can convey a lot of information. We had to swerve onto the shoulder slightly yesterday to allow a motorcyclist room to move out of the way of a car in lane 2 who wanted to merge into lane 1, but didn't bother to signal or check his mirror. The wave we got from the cyclist afterwards said all of "thank you, and screw the guy next to me".
There's a rule of motorcycling that you look at a cars wheels, not the driver: "the car driver is likely to look you straight in the eye, before they pull out right in front of you".
I certainly do - most commonly when merging into a congested lane from a side street, stopping and making eye contact helps understand if everybody is paying attention (the merger can move forward and the merged is leaving a space open for them).
Motorcyclists also have a pretty large vocabulary (I'm not sure how many of these are actually used in practice): http://www.abate-il.org/Backroads/signals.html