Overlook obviously buys lots of other, non-Joe Hill books from PS Publishing and I'm sure gets the right to buy 10 or so copies of Gunpowder as thanks for keeping them in business with all the other books people are not willing to pay $250 for.
The indy publisher is kept in business by the indy bookseller, so yeah, Overlook makes a high profit on this book, but they will also be buying and selling other books where the profit margin is much smaller.
The customer service is a whole other issue...I've never bought from them...but they have a relationship with PS that helps both parties.