Don't use an ATM there. Plenty of them are compromised. Paypal is taken at most places. VISA isnt' always accepted and there can be fees. If you're staying at the very resorty places, they tend to be more credit card friendly but not nearly as fun usually.

The only places that will crack $100 USD usually is a busy bar with foreigners. The per capita income in Honduras is $2400 USD, so it's a lot of cash there. Take $20's, if your wallet gets wet and the bills get torn merchants won't accept them.

You don't need limps. You'll get them as change in some places. Take what reasonable cash you need. if a place will take a credit card (or paypal) do that and save your cash. You really don't want to try one of those bank machines.

Exercise some basic caution. It's not a dangerous place, but don't tempt fate. Don't flash a lot of cash or jewelery (not that many people wear it anymore) and use common sense.