2.) How could the recipients turn their crypto into cash without going through a bank? For example, if we sent 10,000 worth of Rupee to India via crypto, how would the end user convert this into Rupee in their country?
IMO the only option is peer 2 peer trading, and by that I mean direct trade / trading on the spot, not using platform like Localbitcoins. In such countries, considering they're really oppressed by the government and there's a lack of innovation, I also believe there won't be any exchange that support direct withdrawal to their own bank account.