This is interesting because from the reports we've read Thailand is quite compliant with DCC for credit card purchases and will always give the quote slip and then honor the choice.

Some of the ATMs are really deceptive, and one has to press 'no' or 'cancel' to avoid DCC. In this case, cancel in fact cancelled the transaction, making it more difficult to determine how to bypass DCC. I've also seen a setup where you have to page through multiple screens and decline the DCC offer more than once. For example the wording was along the lines of, "Are you sure? We cannot guarantee the exchange rate if you decline. Press OK to accept and NO to cancel." Are you pressing OK to accept the disclaimer or accepting the DCC conversion? Does no decline DCC or cancel the transaction? Imagine most people getting caught in that after a long flight and being fatigued. 7% is outrageous though.

The problem with DCC is that it often occurs in a location where you're not native and might have a language barrier. You also aren't familiar with the consumer protections or options available to you if the merchant isn't willing to play along. Combined with the issuer's propensity to issue a courtesy credit for small DCC charges, the merchants don't have to deal with the pain of a chargeback, so the bad behavior continues.