This completely slipped by but thanks to FTU I learned about it – Chase is offering VISA Gift cards with NO fees and NO shipping.
From the reports on Slickdeals the credit card transaction does code as purchase not as cash advance when using a Chase card. Citibank and Barclays may be different though. Note you can't use an AMEX card to buy the Chase gift cards.
Also it's been reported that the cards allow you to set a PIN.
Not only is The Chase Gift Card widely accepted, it can be loaded with any amount you choose – from $25 to $500. When making purchases you can select "Credit" and sign a receipt if required or select "Debit" and enter your "PIN" if one has been requested by calling toll-free 1.866.466.0079."
Apparently there is an additional charge being imposed if you order more than 20 cards.
If all the above assumptions are correct – this is the new Mint. By ordering gift cards online and selecting free shipping and than buying money orders this can grow your mileage balance for minimal investments.
If you have experience with this card please report it in the comments.