Regardless of what the technical options are, I think that an escrow will always need to be, by definition, a trusted entity. I can see the automated workflow being easy enough when things go well:

  - Buyer sends btc to escrow, stating the recipient address
  - Seller sees btc in escrow, marked to send to his address
  - Buyer can release funds to seller
  - Escrow will automatically do so after x days
  - Both parties can open a complaint

And that's all I would automate. When things go bad, both parties should have a fee to pay to the escrow (that fee may be paid in advance to open account there?) so everyone looses something. Then the escrow will just have to mediate.

Because there's a fee *and* a human intermediary, the chances of successful fraud will probably not be economically interesting in the long run. Someone already trusted would make the ideal person for this, and maybe for a small fee some of us 'common guys' could help assert allegations from either side, if we are local to them.

But the money burning solution, while great at preventing economically viable fraud, does nothing to prevent revenge and actually makes everyone loose if one side is dishonest. I would certainly not endorse that.