Criminals can also trade BTC for physical cash.
They could also by some means (for example permissionless decentralized exchanges) convert it to a cryptocurrency with private transaction properties such as ZCash, Monero, Beam or GRIN and then back again.
The "laundering services" you refer to (generally called "mixers") are still around but most of them have been shown reversible with high degrees of confidence. CoinJoin is the state of the art here, with the most well-known implementations being JoinMarket and Wasabi Wallet.
But in general law enforcement and investigators are definitely wising up to cryptocurrencies and to be fully untraceable one has to go through a lot of hoops and not make a single mistake in the process. Even the above mentioned approaches can leak information that can be used to tie an individual to the transactions if not executed properly.
Most likely they will use the same tried and true approach they would have used for stolen fiat funds; identity theft. I personally know people who have been drawn into a criminal investigation for money laundering because they had been initiated a transaction selling BTC on LocalBitcoins via bank transfer (unwise unless you know and trust the person), turned out already stolen BTC had been converted into fiat on a compromised bank account, which was then supposed to be converted into "clean" BTC again. Fortunately the investigation was already underway when the transaction happened, my friends bank account was blocked as a result when the transfer was initiated and the whole thing was sorted out in the end.
As for spending, there used to be pre-loaded credit cards that you could from bitcoin.