Yes - but only if the merchants set fixed prices in bitcoin, rather than "$20 USD, transferred via bitcoin". Which they won't be able to do until their supplier

Yes - but only if the merchants set fixed prices in bitcoin, rather than "$20 USD, transferred via bitcoin". Which they won't be able to do until their suppliers, employees and taxes can be paid in fixed number of bitcoins. More merchants via instant-USD-conversion will certainly increase the popularity of bitcoin, but won't help at all in giving it a moderate value in tangible goods and services.