You can exclude foreign bidders. I mainly ship the the US and Canada. There is no way to set specific countries yet only a few are separated, but I am hoping they add a Europe or UK option. I don't mind shipping to England, but I get nervous when someone wants something shipped to a 3rd world hellhole. I would say half of my customers have 50 feedback or less.
You most certainly can exclude specific countries. In the auction listing you can pick and choose whatever countries you want to exclude. My exclusion list: Spain, Portugal, Italy, Cyprus, and Malaysia. Why those countries? Those are the only ones where stuff I have sent has ever gotten "lost". And in only 2 of those cases did I end up with a dispute and have to refund. The other 3 were actually cool about it and let it go but I figured if stuff was getting lost going there I probably shouldn't bother in the future.
But I certainly don't want to exclude all foreign buyers. I would like the option of requiring them (but not U.S. buyers) to have 10+ feedback, for example - so that I only get people with a little history buying stuff.
If you exclude foreign buyers in general you really cut out a huge
potential source of customers. I can't understate that. I am currently selling off a lot of stuff I've had sitting around (backlog games I'll never play, clerarance stuff I just couldn't pass up, extras from B2G1 deals and the BBV Buy 5 deal, etc) and probably 1/4 -1/3 goes to foreign buyers. They will pay more than U.S. buyers will and will buy things U.S. buyers never would (e.g., games that aren't sold anywhere but here). Plus, I can offer free shipping within the U.S. and charge $10-$30 or more shipping Internationally (depending on first-class, Priority, etc) and then not get hit with eBay fees on the shipping (since I have a free option listed). So I actually make more when foreign buyers purchase things as I cover the cost of shipping + a little extra with my International shipping rate while with cheap-ass U.S. buyers I eat the shipping cost myself.
In particular, do not exclude Brazil which is unfairly, I think, a target of being blocked. I sell stuff there all the time
. From what I understand, games are just very expensive for them so they like to buy them from U.S. sellers via eBay. I have had maybe 1 problem with a Brazilian shipment out of 50-60 or more things sent there over the years. I have 3 things to ship there tomorrow in fact!
There's always the potential for problems no matter where you ship. My last refund came from a U.S. buyer who said a brand new sealed game I sent was broken clean in half
. They said the case was perfectly fine and the game was sealed but the package looked "roughed up" and the game was broken. I have no idea if they were telling the truth but with eBay there's nothing you can do except give them a refund.