LocalBitcoins rates are very fair, 1% off of the top for escrow, but chances are you are selling above the Bitstamp price (but below the Mt Gox price) with an established account in a populated area, you would have had zero problems converting $50k in BTC to $50k in USD. The thing is, you weren't prepared. You could have transferred the BTC to your uncle, he could have done the KYC verification with CampBX and also had cash pretty quickly.
When we say that BTC is good for moving money cheaply, the money we are talking about is BTC, not government fiat. After you move the money, you go through the same hassles to convert BTC to local currency as you would with any obscure foreign currency, in many places there simply are not a lot of options, and the options that are available are subject to extreme regulation.
The location for exchange in the EU and US are both major cities with populations >1m. In both cities the localbitcoin.com limits are too low and would likely require a couple weeks to disperse and then acquire $50k worth. I've also used local exchanges and yes they are great. Just not enough volume for larger quantities.
I agree BTC is amazing when transferring and using only BTC. It's just not a realistic outlook though for day to day life and wont be for many years to come. So much so that if someone says "bitcoin is great for money transfer" I consider this misleading. Should be "bitcoin is great for bitcoin transactions". It will be years before someone can say the former without a disclaimer