Me, personally, would constantly have 2nd thoughts about it. Reasons that come to mind are: reputation and how detail-oriented the person who is doing the work is, cost, shipping, cost, and probably cost.
Now, for me, I think it would be MUCH cheaper to buy a $300 motor, get it assembled at my local machine shop, cleaned also, etc, than to pay someone in another state to buy a $300 motor and pay labor to install new parts/rebuild. Then, shipping.
Now, lets say, for instance. Some of us come upon a free block and just need new parts installed. I would pay for shipping to the person, plus the parts, etc. Then shipping back.
Then...there's the whole thing about some people will want to ship out a block with parts they have laying around to use on the rebuild and the person rebuilding may say that the parts are bad, then the customer gets mad saying his stuff was good and then there's a whole lotta drama.
I, personally, would only stick to rebuilding for friends or people living VERY close to me, or have a HUGE list of what is permitted/not permitted (like using ALL new parts). But, then, again, that leads to a MUCH higher cost.
Ugh...everytime I type something, I think of something worse...and the bad things that could happen.