People should realize that Etsy as a whole does not speak for the millions of small shops that sell there. Before you place your order you should check the shops reviews and send the seller a quick note to see their response time and business manner.
Quite frankly it's silly to peg Etsy as a whole as fraudulent when each shop is independent of Etsy. Just like eBay or Amazon, it is your responsibility to check out the credentials of a shop before you purchase. If you are unhappy with your purchase simply dispute it with your bank or credit card company if Etsy is not fast enough for you. It's just that simple.