1) To sway me to your side of the argument you will have to demonstrate how the value of Gold to be used in jewelry is fundamentally different than the value in a given utility trait of the Bitcoin network. Gold being used as jewelry and Bitcoin's ability to transfer wealth over large distances almost instantly between any 2 parties with no third party intermediary are both judged as valuable by various people. Why does one impart "value" to Gold while the other doesn't for Bitcoin?
1) The best question asked to me since I registered to this board. Great! Yes Bitcoin is scarce (though possible replacement by other cryptocurrencies make less safe), divisible and so forth.
However money has always been valuable for itself (as you seem to recognize). The reason for this is that money is one part of the transaction. If I give you something (good) I want something that is valuable in return. If you give me nothing, I must fear that nothing will eventually not be accepted for something.
Now why is gold something? As you stated it can be used for jewelry and it looks great even in bar form.
Now Bitcoin cant just cheat this requirement. You say you have identified the value of bitcoin:
" Bitcoin's ability to transfer wealth over large distances almost instantly between any 2 parties with no third party intermediary"
The problem is that 1 BTC has no value for itself. The network however, (Bitcoin) is transferring BTC. (I am using the signs now to differentiate between the network and 1 bitcoin).
Thus the network does not have the ability to transfer wealth as bitcoin is not wealth but nothing.
Sorry I know I said I wanted the "how" before but now I realize I also would like to know the "why". Why does valuable exchange properties not give Bitcoin value? Why does the value need to come from a property not related to Bitcoin's ability to serve as a medium of exchange or store of value? Who decides what properties lend to something's value or not? Why would we listen to them anyway?
I jokingly (I hope you forgive me 
) describe it like this:
"ability" of Bitcoin network: transfering nothing at a cost.
Hah, actually that does sound like a clever one line summary of your argument. ) describe it like this:"ability" of Bitcoin network: transfering nothing at a cost.
My take on it however is how can you call something nothing if it can be exchanged for things of value? Doesn't this ignore the reality staring you in the face?
You've given me good insight on the opposing view to mine regarding this frequently debated topic, thanks for that regardless of what else comes from our discussion.
I'm a bit loathe to bring it up but I've heard some others make the argument that before there was any exchange value in bitcoins it was still desired by some as "nerd tokens", an interesting piece of software to experiment with, and therefore doesn't violate Mises's theorem at all. Feels a bit weak to me, trying too hard to pigeon hole Bitcoins to fit an antiquated theory but maybe I'm wrong there. Thoughts? Could the novel nature of the software be a value for bitcoin outside it's use as medium of exchange or store of value?