Washington was anything but inept at running a spy ring once the war got underway.

Unfortunately his initial attempts were a bit hasty and resulted in the death of Nathan Hale. And unfortunately Hale's treatment did have an impact on the way Major Andre was treated.
http://www.srmason-sj.org/council/journal/feb00/poteat.htmlAt the beginning of the War, Washington knew he needed eyes and ears inside the British-occupied cities to spy out the secret plans of the British, and one of his first orders of business was to create his secret intelligence service. His initial hasty attempts to place a spy inside New York would end in the death of his first spy, Nathan Hale, whom the British captured and left dangling from the gallows in his stockings for three days as a reminder and deterrent to other potential spies. The British, nonetheless, begrudgingly acknowledged Hale's now famous last words, "I regret that I have but one life to give for my country."
Washington would eventually succeed in establishing extremely effective spy networks inside New York. These kept him well informed, in advance, of the British military tactics, strategies, and plans. Washington established independent spy networks, each without knowledge of the other, a key commandment in the practice of the intelligence trade. His spies committed their identities to memory, using code numbers instead of names, passing encrypted messages, using invisible ink—all the while running the risk of capture and the gallows. Major Benjamin Talmadge, a classics scholar from Yale and a classmate of Nathan Hale, headed Washington's Culper Spy Ring. Washington was referred to only as Code 711. New York became 727, Long Island was 728. Talmadge would use the pseudonym John Bolton as well as the code number 721. The ring succeeded in preventing the British from interdicting the arrival and safe landing of the French fleet with its seasick and vulnerable cargo of soldiers intent on helping the colonists.
One of the Culper Ring's most surprising and successful agents was known as Agent 355. Her true identity has remained a secret to this day. She is credited with having helped uncover Benedict Arnold's treachery in surrendering West Point and aiding in the capture of Major John André, the head of British intelligence in New York. Washington offered the British to trade André for the return of Arnold, but without success, so he reluctantly ordered André hanged, as had been Nathan Hale. The British would soon capture agent 355 as the spy who must have compromised André. She was imprisoned onboard a ship where she would die from abuse, illness, and neglect.
Indeed, that $17,000 was an amazing sum of money for the day! I would imagine that a good portion of it also went toward "hush money" and bribes.
Linda