I subsequently found some detailed blogs with comments from upset expats. It is the local banks in concert with Banelco and Link that are doing this. The verdict is that Citibank is the only option to get unlimited withdrawals without a fee, maybe because they do not use Link or Banelco. When I passed a Santander at a shopping mall in Palermo, I checked and it is the same deal since it uses Banelco. I also walked by either a BVBA or a BNP and noticed the Link sign, so didn't bother. Link appears to have the $320 cap as reported in my earlier post.

(I'll report back if I pass a Citibank.)

When you get your receipt it lists $800 (pesos) or whatever you take out and then a separate line with the $11.44 fee (or whatever the exchange of the day is vs. USD 3). It's the same as when you take out money from an ATM in the US where they usually charge fees for other customers. I have not had an account with a bank in the US that charges "foreign" ATM fees for more than a decade but I recall that they only emerge on your monthly statement.

My bank has no fee on any ATM transactions and gives me the Interbank rate for foreign exchange. If I take out money in Europe and check vs. the interbank rate at www.oanda.com I match the exact amount to the final cent.