It is more accurate to say that the point of Bitcoin is everyone has perfect information about how much money everyone has and who they transact with. The hackers are free to send the stolen money to someone else with no central authority to stop them, but an exchange is likely to reject that because they deal with fiat and therefore have to meet certain legal and ethical standards.

The hackers can still spend the money on something else provided the other party doesn't hold themselves to the same standards.

"likely to reject" -- I haven't seen any history of exchanges stopping specific withdrawals for certain coins.

There are dealers and exchanges who abide by regulation in one or more countries, and some that don't.

It's also public record where transactions travel on the blockchain, so if it was ever noted what address the funds entered, I imagine it could prove difficult to dilute the transactions enough that the ledger wouldn't be accepted as proof. But I'm just speculating on that last bit.

The point is to not to need to convert back to fiat.

only to transfer it into another currency

you can trade bitcoin to bitcoin just fine