Where to safely buy "ethnic" instruments of good quality online?

I second Lark in the Morning, I've bought more than a few percussion instruments etc from them.

if you're ever on holiday in Japan, I found a great store in Kyoto - KOIZUMI GAKKI

Just bookmarking this incredibly useful thread...thanks for all the info.

My parents started Dusty Strings back in the 70s and still run it today, so I'm a bit biased - very nice dulcimers, but definitely a premium price tag especially on the higher end ones! I have an older prototype dulcimer of theirs, and it's pretty mellow and sweet sounding if you play with the leather-tipped hammers, like a felt pedal on a piano

ShopGoodwill.com is my favorite spot to browse for interesting instruments - there are some real gems that slip through there. I recently picked up a Roosebeck rosewood bodhrán for about $60, in like-new condition. The listing was mis-labeled as a "Toca Jamal Drum with Case and Drum Sticks", which might be why I got it for so cheap

You have to wade through a lot of pretty low-end/junky instruments, but there are definitely some gems in there.

I also got a waldzither years ago on ShopGoodwill (a cittern-like instrument), though I later ended up trading over to a used cittern that I found on Mandolin Cafe classifieds.

I found a good-condition rosewood clarinet on ShopGoodwill also for about $60. And a solid steel-string cedar-top guitar for around $140 or so, can't remember for sure.

I'm always looking for that sweet spot of "sounds really good, but not the highest-quality / most expensive instrument out there by a long shot." To that end I bought a shakuhachi years ago off Amazon, for around $160, and it sounded great!