>But if the reason for taking the payment is legitimate you're going to have no more problems with Bitcoin than you will with cash in this regard.

Nope. You may deposit cash into a bank and explain where it came from. Sure.

This has no relevance to how you can later try to spend your bitcoin and have your transaction frozen + end up in a police investigation where you need to try to explain why chainalysis software says you are linked to terrorism, to people who have no understanding of it. This can be especially bad if you are not in a developed country. It simply means bitcoin is not usable as a "peer to peer cash" as it was intended. With cash you will not have such problem because it has no history permanently linked to it.