I think all of us that actually stop for stop signs experience this problem, but I wouldn't call it the Wave of Death, but then again I've never seen a motorist wave me on to cross a multilane roadway, only at stop signs. I've developed tactic to ward off this Wave of Death effect, basically I look away while waving the car on, that way the driver knows I can't see him/her, so they just go. That works in most situations.
I don't think of this waving as a Wave of Death, rather I believe, it's from a lot of cyclists rolling thru stop signs, so motorists are kind of programmed for cyclists to not obey the rule of the road, so they just give a wave.
I bet a lot of cyclists in large cities, like NYC don't see too many motorists waving them on. I believe it only happens where motorists don't see tons of cyclists. BTW, they also do this for pedestrians, but again, I bet pedestrians in NYC and other large cities don't see many motorists waving them on.