I may be wrong but I understand from AdWords support [adwords.google.com] that you do have the option of paying in your local currency so I am confused when Freedom says
And Google will never offer AS earnings in local currency because the advertisering (sic) rates are set in dollars. They will not convert it for you because they will have to pay conversion fees.
As far as the business side of things are concerned it would make sense for Google to disburse itself of local currency it gathers in the local market rather than having to import that money to the US and suffer exchange rate vagaries. It may have tax benefits too.
From a customer service point of view, if Google are looking to expand their content network then they will surely need to accommodate foreign publishers who may themselves wish to limit their exposure to exchange rate fluctuations.
I expect that at some point Google will have to improve their interface with publishers and this includes paying them in their own currency.