auntrenae said:
For all you 'experienced' travellers.

I've been reading all these Mexican guidebooks that say we have to split up our money and cards when shopping in Mexican cities so we can't be pickpocketed, never to wear a money belt

or belt pack, and to never take out a card or more than a couple of dollars in one place, because 'they' are watching and will know we have something worth taking. How do we pay for something if we can't reach for any money?

Find a bathroom to take it out of the pocket?

I never take much with me anyway, because it's all spent on the cruise itself, but I like to buy souvies.

Any ideas?
Renae
I wouldn't say I'm very experienced but I've been to Mazatlan, Cabo San Lucas, Puerta Vallarta, and Cozumel. I was worried about pickpockets and being robbed quite a bit before too.
The rule of thumb I would use is to not do anything you wouldn't do in a major U.S. city. I wouldn't flaunt money or let people see how much I am carrying in Mexico any more than I would San Francisco, Orlando, Chicago, Cleveland, Indianapolis, etc.
While in Mexico, I never felt the least bit threatened. We did get approached often but it was always someone wanting to do work for us - braid my wife's hair, sell us something, take us on a glass bottom boat tour, sell timeshares, etc. Unlike many U.S. cities I've been to, no one seemed to want money for nothing. They all wanted to work for it. I really respected that.
Treat them with respect and they will show you the same. A polite "no thank you" worked every time.
Now, this only goes for the populated tourist areas. I never ventured out of them into the more run-down areas or residential areas. I assume it is probably different there.
I wouldn't take large sums of cash with you (and it isn't a bad idea to split it in different pockets). Depending on what you want to buy, be expecting some change to come back in their currency. For this reason alone, it is smart to not try to buy a postcard with a $20 bill.
We also ended up using our credit card a lot in shops. We keep a small-limit card I use for foreign travel and Internet purchases. Fraud should be covered but in case something happens, we aren't out too much. I've heard you can get a better (and more accurate) conversion rate using a card instead of cash anyway.
I think you'll see once you get there that there really isn't much to worry about!
I hope that helps! See you at POFQ!
-steve