One thing I dislike about the Gifting mechanism is that the buyer is billed before the recipient recieves the code. The buyer should really only be billed upon the lucky devil hitting the Accept button, and not at all if they decline.

No thank you! I don't want to end up with a credit card charge a couple of weeks after I made the purchase and stay there and think where it came from.
That could also lead to situations when people put just enough money into their account, gift the game then spend the money; if they were billed when the recipient accepted the gift the account may be empty and what do you do then, withhold the gift?

You overdraw.

Not all banks allow overdraw; also, some use a one-time generated credit card number (I know I do) which can't be re-used so you can't overdraw without significant hassle and more money spent on the procedure than the total price of the game.
Money on-front is the only viable solution for internet shopping fortunately.

Well at least refund the gifter upon having your gift declined. I know for a fact Steam doesn't do that, and it should.

You can always contact support here on GOG and tell ask them to either re-direct your gift or maybe give you a discount for its value.
On Steam you can change the recipient of the gift it if hasn't been claimed yet, send it to one of your email addresses and activate it on your account or just gift it to someone else.

This shouldn't be allowed. It's not an issue, it's not a bug, it certainly isn't dumb, it's the choice that gives GOG the most revenue.

You can on GOG as well, just fetch the code from your account page and send it to whoever you want using any means available. Of course, since three people then have the code (yourself and the two different receivers), the fastest redeemer gets the game.

Both solutions suck. And on Steam, that didn't happen. I was gifted Psychonauts on Steam which I absent mindedly declined, thinking it was another shitty Update News thing. The dialogue didn't return and the guy who bought it was billed and was unable to transfer the gift.
As for having to go to support for that is just added hassle. The point of your expenditure is to give a game to someone else. Now, I don't know what happens when a gift is declined on GOG (I've never done it, and no one's declined my gifts) but the way I figure it should work is that upon your gift being declined one of two things happen:
a) You're refunded
b) The code remains unused and can be transferred elsewhere
But, as I said, I've never declined nor been declined, so I don't know what does happen.

Even better! Also, there wouldn't be 3 people that have the code as the situation we're discussing (the one put forward by TheJoe) implies that the original person who was gifted declined the gift.

He either didn't know where to look in the Steam client or he lied to you. I've had my gift both declined (I don't even think it's possible now anymore) and ignored and have always been able to send it to someone else.

The economics of sales can be a bit different between when people are buying something for themselves and when they're buying that thing for others. It could just be that the folks at GOG determined that sales within the context of gifting just didn't make good business sense.

How come? you still pay the same price when gifting a game right?

Sales can be beneficial to retailers in several ways. In the case of GOG I'm guessing the main benefit is that the spike in sales volume more than makes up for the lower margins, resulting in higher overall income for the duration of the sale. This increase in sales volume is due to the reduced price motivating people to buy the game when for whatever reason they weren't motivated enough to buy it at the regular price. However, when people are buying things for other people there are usually other factors that trump price differences (often timing), and thus there's not the same large spike in sales volume to make up for the reduced margins. Now, this is all speculation on my part and there are other ways in which the economics between personal purchases and gift purchases differ, but this should at least provide an illustration of the kind of things the folks at GOG may be considering when planning the scope of sales.

B happens, the code is always visible in the givers account, even after it's redeemed (click on "Gifted Games" on your account page), and can be given to anyone by e-mail, instant messaging, a hand-written note, or any other viable means.