I personally think the free shipping attracts a specific type of person. Before I started selling on etsy I was kind of shocked some items to ship were so expensive (well now I know why :)) and it kind of turned me off.
If your profits allow, I would offer free shipping. I was actually just thinking about offering free shipping on purchases $50+. It shows you are incentivizing, you'll most likely get more items purchased and you'll make the customer happy.
I definitely understand this doesn't work for everyone, and yes it may not work (if you're not promoting it enough or posting it in the wrong markets) but you never know until you try yourself :)
For your shop, I might have an idea for you...buy 3 get shipping free :). I think that would be a great base to build off for you for sales. In the meantime get your listings to at least a page long (24), and I think that'll get you more sales as well
Hope this helps! Sorry for my slight ramble haha
Kelly