With the continuous advancement of electricity market reforms, strategic behavior by generation companies is increasingly highlighted, especially regarding its impact on demand-side prices. The demand-side price is defined as the locational marginal price (LMP) at load nodes and is used as an indicator of the electricity-price level faced by loads. A simplified network structure of Jiangsu Province is used, and the impacts of installed-capacity structure and transmission capacity on collusive strategies of generator groups, demand-side prices, bidding outcomes, and social welfare in a provincial spot market are investigated. Four case studies (Case 1–Case 4) are constructed, and generator strategy selection, market performance, and demand-side price volatility under different installed-capacity and transmission-capacity conditions are analyzed. Under an uneven distribution of generator market shares, collusive behavior is found to significantly increase demand-side prices, reduce load demand, and aggravate consumers’ electricity burden. When transmission capacity becomes binding, collusion is intensified under system congestion; LMPs are increased through strategic bidding around congested lines, and market prices are further elevated together with generators’ profits. Social welfare is shown to be markedly lower under collusion than under perfect competition, and an additional welfare loss is observed when congestion occurs. Overall, changes in installed-capacity structure and transmission capacity are demonstrated to substantially affect generators’ pricing strategies and market efficiency, and effective measures in grid development and energy transition are required to mitigate the adverse impacts of strategic behavior on demand-side prices and to improve overall social welfare.