Many problems with the reimbursement program seem fixed. Stories from earlier rounds seem to have changed things, which is a sign that things can get better.
Given I had all the right information up front, I got the full amount returned on my first report. The housing allowances are very generous for Chile and things like requiring a housing contract is not exactly a 'pile of paper'. I finished my entire first report in a single morning, having kept myself organized ahead of time.
The legalization process for foreigners is also pretty slick. Try coming to Chile (or anywhere) and getting an ID card, bank account, and apartment in 2-3 weeks without government help. You may feel your time was wasted by RVA, but you win a lot of time if you choose to. If one doesn't feel that these things are worth his time, it may make sense to raise money from friends and family and stay home.
Regarding the RVA involvement there are many ways you can participate. For example, spend some hours teaching a local Ruby or web design. This sort of thing may actually help you work better too.
Above all the biggest problems are in communication, which seems to get better over time.
My feeling is that more accountability for teams (required demos) and the impact they have locally would help everyone build a better sense of trust. So would a stronger commitment from Startup Chile to communicate their goals clearly to new arrivals.