Oh, really? How many fraudulent transactions did you get from Russia last year, for example? Russia was called a "fraud hotbed", but it was 10 years ago. Now it's almost an European country with strong and fast growing economy. Ignoring such countries as Russia or India (with millions of Internet users) for a long time is a silly mistake of Paypal. Moneybookers and such local systems like Webmoney in Russia and Ukraine took its place.
This guy seems like he is selling physical products (health food) from the US. I would bet that very few people in Russia are buying internet products in the US to have them shipped. Aside from all these 3rd party payment systems, lots of people in Russia and India have Visa and Mastercard cards, which you can use with any regular merchant account (although you will pay a higher interchange rate).
It isn't true, however, that merchant accounts are always cheaper than paypal - http://www.informed-merchant.com/articles/merchant-account-costs.html
And it still has an extremely high rate of fraud. Until that changes taking orders from there just isn't wise.