The more parties you involve in a transation, the more points of failure there are.
Exactly, that's why the arbitrator is not needed, every human can make a mistake.
MultiSig escrow sounds nice, but for 99% of use cases it is not a better way of doing things. There are plenty of threads discussing it though. You don't need to crap on mine. Thanks. Also, multisig escrow provides absolutely no additional protection in the case mentioned above. An arbitrator would be needed in either case.
1) MultiSig can protect from arbitrator mistake - it is a very important point.
2) Actually, the additional protection in proposed MultiSig scheme is not required. Motivated to be honest participants is the best protection!
With all respect to your person,
Serge V.
