Generally it is only market makers/specialists that can use these "between the bid/ask" denominations, though some more advanced direct access platforms can also do it. I use E-Trade Power Pro, which is supposedly a direct access platform but I cannot enter beyond 2 decimal points.

So, the MM can take a large order and fill it between the bid/ask thus controlling the flow. Retail, can only enter sells at .89 or buys at .90. Chances are you will still get one of those between fills, but all the advantage/control goes to the MM.

The MM fills orders for large customers and small, as well as for themselves. Obviously this will better advantage the large customers.

The purpose below $1.00 was to give the MM better control over liquidity and keep volatility down.