On the other hand, if I steal $1,000 and make retail purchases over the course of twelve months less than $5 each, the monies would not be returned from the retailers to the victim of my theft. At that point it is up to the courts(civil and criminal) to force me to make amends to the original victim.

Your scenario is similar to the latter example for most of the end recipients. If an account with zero bitcoins receives a stolen bitcoin and sends it to one recipient, that recipient would certainly fall under the first scenario I put forth. As the transactions become more complex and diffuse, the latter scenario is more likely.