You bring up a good point. Asside from the flame retardant nature of cabin materials, even a malicious fire on board an aircraft in the passenger compartment would certainly be more recognizable and accessable, making it easier to put down. Ie., with a fire extinguisher or other fire fighting procedures. Putting items like that in checked baggage could pose a more difficult problem should they accidently be ignited. I would question though, if they don't have some sort of fire suppression systems in the cargo areas of modern aircraft to put out such fires should they occour. That I don't know though.

I can see the issue with USPS and other shipping methods where packages are put on commercial passenger aircraft. You would think if it is illegal in luggage it should be illegal in packages as well. I would then ask, how could it be different with companies like UPS and FedEx where they use their own fleets of aircraft dedicated solely to cargo?

I don't know if matches contain nitrates either. Do the scanning devices only detect nitrates though or are there other flamable materials that they might detect? A pack of matches or two in a bubble pack envelope in a large sack of mail might not be enough of a concentration to cause a detection but my thought would then be, what about say 50 packs of matches in a small suitcase?