When doing registered mail, the post office employee has to physically watch you seal up what you say you are sealing up in the package, so you can't commit insurance fraud.
Not at all.... I used to and sometimes still do ship out registered mail, every one has been prepackaged before shipment. All I do is go to the post office, stand in line, then ask them to ship it out. No 'packaging in front of them' required.
If you are shipping via registered mail, you can't just ship someone a wad of construction paper, with a tracking number and say it was cash, because the post office wont allow you to do so.
Yes you can. If you try to file an insurance claim they will ask you where is your proof that the item inside was worth the insurance you covered.
I've done a few smaller cash trades which didn't require registered mail, and we just did overnight shipping, but for larger sums of money, it is certainly worth doing everything right.
If you want to add in an extra $30, stand in line at the post office (no drop offs), and spend at least 30 minutes to an hour shipping out one item, sure. So far all registered mail I've done has always arrived with no problem.
Edit: Nevermind, I read the first page over and saw that someone already mentioned that you didn't have to package in front of them and you said you had to do it for precious metals. That makes sense, I 've never had to do that before in registered mail but I guess it should be done for more valuable items.