100% agreed with you, OP.
Although the bounty mechanic is a really cool idea - makes player killing legit, but only in a few rare instances, which is balanced.
I actually touched upon this issue in my topic about Suggestions to improve Freemode not so long ago, and I came up with mostly the same fixes.
The Bounty System
Suggested by Ren Fujin :
I think the Bounty System is a very cool feature. It actually makes player killing in Freemode legitimate, but only on specific occasions, which is very balanced. I do believe it has room for improvement, though.
Hiding in houses or garages
I think being able to hide in your house and/or garage breaks the bounty system. And it's being abused more and more, I wouldn't be surprised if the bounty mechanic soon becomes obsolete because of this.
I suggest removing the ability to enter houses or garages when being the target of a bounty, or only allowing it for a limited amount of time. This way, players could still get in safe places if they want to retrieve a vehicle or regain health, but they should have no choice but to come out and face their fate after a set amount of time, to keep it balanced.
Bounty hunters actually have a chance to terminate the wanted player and claim the bounty if they can get to them, no matter what. C'mon guys, the map is big enough to allow wanted players to run and hide, there should be no need to exploit houses and garages.
Escaping a bounty hunter might prove a bit too difficult to some.
Well, I believe that coupled with the Advanced Blip System mentioned above, it should be balanced enough to give wanted players a chance to escape and hide within the game world. Remember that under such a blip system, you have to ID a player visually only whenever you're within their vicinity !
How about you change clothes or vehicle to escape a bounty hunter instead ? That would make for a more challenging and immersive experience to both parties.
Suggested by Daniel_B :
The one change I'd offer on the bounty idea is that players shouldn't be forced out of their apts/garages after a brief time, but if they spend more than, say, 5 minutes in there (or go to a solo session, or an invite-only session with their friends), the bounty should be canceled and the person who set it should get their $$ back. The bounty target shouldn't have their gameplay limited in any way--especially if they're the innocent target of griefers--but they also shouldn't have an easy way to sit back and collect the money without taking any risk.
I also believe all the players trying to cheat/exploit their way out of a bounty are missing the point ... the bounty mechanic is all about setting up really fun chases, some of the most fun I had in Freemode was because (or should I say thanks to) of bounties. Anything and everything can happen when you're chasing a bounty, or when you're the target.
... people complain there's not enough to do in Freemode, but as soon as a gameplay mechanic tries to give incentive to have legit player on player action, they deem it as an hindrance and try to find ways around it.