Yes, the atmega128 can be interfaced with FTDI chip directly - it's Rx/Tx connect to the FTDI chip.
http://www.atmel.com/Images/2467S.pdf
Atmega128 as a board type does not exist in Aduino-land, you will have to create a few files to support it. If you look at the Arduino file structure, you can see how a new Variant will be needed, with boards.txt and pins_arduino.h.
These 2 files were created for the Atmega2561, which looks to be similar to the 128, maybe a good starting point.
I have shipped boards to India, USPS flat rate shipping took several weeks to clear customs. Purchaser suggested paying for FedEX/DHL type service next time (lot pricier tho).