Let's assume an interest rate of 0%. If the market rate of a bitcoin doubles between now and the date of repayment, you will only have to return half of what you originally borrowed.
As such, taking this on only makes sense for someone who expects the price to go down, unless I'm missing something.
You're missing the whole point.
If someone is lent BTC, and they sell to USD, yes they're at risk to BTC/USD flux. They can lock this with a future of 3200USD at todays price, or some floating CFD.
It's his choice what he does with BTC. You can apply your derailing-off-topic crap to any loan request on here for hardware; mining equipment or anything bought in USD.