The lack of distributed exchanges is Bitcoin's Achilles heel at the moment, and Ripple is changing that.
I agree that that lack is a big problem. But I dont see that Ripple is the solution as it needs gateways which are companies (exchanges, banks,...) which can be shut down.
The only possible solution for a decentralized fiat/crypto exchange I see is to use the single users bank accounts. No government or bank can seize the bank accounts of millions of "average joe" users, but they can easily attack companies like MtGox,...
Gateways are only there for convenience, the system can operate underground in a fully P2P manner if necessary.
The system only trade IOUs, to bootstrap that system you need a lot of outside real money or many merchants accepting these IOUs. The only way how to get in Fiat are gateways. So for me that seems to be a major part of the system.
The friend2friend network may be ok. The money is debt idea (IUO) may be ok (even I dont like that). The gateways are for me the critical point. In BTC system the exchanges are not a part of BTC, they are the external environment and hopefully we get soon a better solution. The Ripple gateways are the backers of the IUO currencies (if I understood it correctly). Without a gateway you never get real USD for Ripple USD.
Maybe we rotating in circles as I focus on that part of the system and you on the p2p network...