No offense, but you are spreading false information. There is no law that "The FFLs only need to exchange signed copies of their FFL licenses. " The only law applicable states that the party shipping the firearm interstate needs to ship to an FFL in the receiving state. No one in the transaction needs anyones FFL copy. It is just the most common way to have proof after the fact that the firearm was, in fact, shipped to an FFL holder. The person shipping the firearm does NOT need to be an FFL holder.
No matter what your dealer tells you or you hear on the web, read the frequently asked questions on the ATF websight concerning these issues.
And contrary to your scenario, in a transfer, I go by my dealers and get a signed copy of his FFL. I stick that in a FedEx envelope and I send it overnight with the funds, to the seller. It costs me $14 for the FedEX. Only $8 for 2 day air. Both ways gets me a tracking number.
Handguns I usually try to get the seller to do FedEx 2 Day and then I have the deal done in three days, if he ships quick on his end.
I think Demogorgo's mistake was not getting tracking on the shipment of his funds, no matter what the method. He sent a cash equivalent in the mail with no way to track or confirm delivery and he now knows why that is a bad idea.
The seller never cashed the money order, apparently. Why does everyone doubt that the mail lost the stuff? Happens all the time.
Spend $8 and 2nd day FedEx the guy another FFL copy and the funds and get the gun.
Why let this completely cloud your buying and vow to never do another deal on the web?
[Flame suit on]