I know most people like going for what seems cheaper, but sometimes you should just go with the dealership. The thing about backyard mechanics is that they can be not only shifty, but honestly outright crooked. My aunt got took for over 1700 dollars by someone she'd been going to for years - seems he has recently developed something of a drug habit. Furthermore you never know if they're just going to keep your car or even if they're really qualified to work on it. What's the point in having them "fix" it when it breaks down a week later. That said dealerships love to add on costs you don't need, and some of them are just as shady in their behavior. The only difference is that as a business they are rather a bit more liable and there are far more options to take when dealing with them. So I say go with the dealership most times.
Well I have family members who are mechanics, so they are not going to shaft me. I also have close friends who are mechanics and they aren't going to shaft me either. They will usually give me very good mates rate, and family will do it just for parts. In general I would say go to a backyard mechanic, but make sure you know who you're dealing with, speak to people and make sure they are trustworthy. Most of the good backyard mechanics get most of their custom through word of mouth anyway.
I understand what you are saying, it is hard to trust the backyard mechanic, I had a guy swap out a brand new battery for a dead battery and swear to me he didn't do it. I had just paid $100 for that battery. On the other hand I have a friend that is very trustworthy does great work. You can go to the dealership and still be taken for a ride. I think you will be taken for a ride no matter which way you go you are just a pawn in the pond.
I don't think backyard mechanics are always shielded from public opinion. Obviously, if they keep doing bad work, then word gets around - and they will have a tough time getting business. Anyhow, with the net, it's often easy to find out about good businesses vs bad ones.