Not all cryptocurrencies but it's true for something like Bitcoin. The problem is you can trace the transaction to the attackers wallet, but where does it go from there? It might sit there, they might throw the money in a tumbler, maybe they sell it for cash... If or when it shows up in a KYC-compliant exchange it could have changed hands many times already and it might not be possible to say anything about the actual criminal at that point.
So it's up to the individual to make sure they're not accepting dirty money. Shouldn't be hard to write software to accomplish that. The exchanges can do it --- flag incoming dirty money. Average users don't accept btc from strangers as a payment for goods or services anyway.
Yes, but for example when you use a tumbler (mixer) the whole idea is to receive random coins back. Also you can not rely on everyone to know and care about this. And not all dirty money is publicly known anyway. So there will always be ways to get rid of dirty BTC.
The non-fungibility of bitcoins can be seen as an advantage or one of its largest flaws, depending on how you look at it. Either way it's the reason quite a few people have switched to Monero and other completely fungible coins.
>Shouldn't be hard to write software to accomplish that
There are startups offering exactly this as a service already.