Yes to all of this.

I work as a freelance sociologist. I have a great set of corporate clients, and I am never out of work. But I agree with everything that you said above. Freelancers can also be pretty cuthroat, and will undercut each other on price. That is always a shame.

I do not use Odesk. What really catapulted my career was attending professional conferences for my industry. I wouldn't have any professional contacts if I hadn't shelled out for these things early on, and I may have even quit if I didn't have the initial inertia.

Outside of using LinkedIn, my biggest advice to freelancers would be to meet people face to face, through any sort of networking association that is accessible to them.