Since you are planning to start a business with the buyer going first I would suggest going with a trusted escrow. You can find many trusted escrow users here in this forum. First build your reputation as a trusted user and you will clients here other than that it is hard to trust a new user. Good luck with your venture.
Using Escrow services would result in me dealing with 3rd parties and making the entire process lengthy and cumbersome. To assuage the fears of buyers, I would initially start with very low amounts as well which can make them feel safer. As the trust factor grows they can have higher volumes.
1. Are you going to create a website for it or planning to roll out through this forum?
2. What kind of documentation you would require to purchase gift cards using your service?
3. Why only Amazon? You should look to increase the product offering.
If you keep the fees low and as per the market rate of localbitcoins platform, a lot of people will be interested in this. Fees is a very important deciding factor for Indians. So keep that in mind.
To answer your queries:
1. I plan to use the forum and am deciding the flow to make the process as transparent and efficient.
2. No documents required
3. Starting with Amazon. If the response is good, I can expand the inventory.
The fees would be minimal. Say you purchase a Gift Card for Rs. 1000, yoo would have to only pay for 1000 in ETH and probably some fixed cost to cover the Gas other fees. Think of some fixed percentage that is sufficient to cover Gas on Bitcoin, Ethereum, Stellar and a few other networks.