Bitcoins can be exchanged to dollars in questionable exchanges like BTC-E or LocalBitcoin. These exchanges are not interested in the source of Bitcoin, do not co-operate with authors (police) and thus scammers are able to do cash out stolen Bitcoins. You can only see the Bitcoins go into the exchange, but the exchange won't give you, or the authors, the details who is the user who is cashing out.
Furthermore, when more legit exchanges try to make sure they follow Know Your Customer rules and demand the users to show the proof the Bitcoins they are selling are not stolen, there is a backslash from Bitcoin community. Some libetarian parts of Bitcoin community do not wish to destroy Bitcoin fungibility, e.g. making sure that criminally obtained Bitcoins cannot be discriminated from legally obtained Bitcoins. This is because much of Bitcoin transactions are fuelled by dark markets which are outright illegal.
Please see recent discussion with Evolution exit scam.