WOW what a nerve this has hit!
We have used Sterling travellers cheques in Arillas for years now. There are several places you can change them, and some business owners will as well. We get them from our bank and they cost us nothing, not a penny, for the security. We take the accommodation money to pay our hosts in euros, and a bit more to buy a day or so's essentials (you know - Mythos, cocktails, meals etc in that order) and keep the serial numbers in another place. We will do it again in 2 weeks' time.
And as a related note - I have to comment that over the last 12 years I can tell you that any theft or crime will be done by tourists, and since nearly all of the tourists are people like us, it is very unlikely to happen. I have never heard of a case in all the time I have been there. Leaving money or valuables in the room when you go out, they will still be there, intact, untouched when you return. It is a difficult aspect to promote, but still true.
Phil