Is it true that the betting functionality does not allow betting in the US?
The betting occurs in on the blockchain peer-to-peer. There is no way to block it, that's the whole point of decentralized systems. If it is illegal for a US citizen to bet in the US then they need to obey the law themselves. The TOS of clearwallet spell this out clearly - if the system is illegal to use in your jurisdiction, don't use it.
The next logical question, is how you and Peter avoid or deal with, indictments/international arrest warrants, like PokerStars and others?
Well then they'll be arresting all the developers of Ethereum, Mastercoin, Counterparty, NXT, Qora, BitHalo. We are not running a betting shop, it's just a protocol layer. We are neither beneficiaries nor owners of any gambling company.