Not to beat a dead horse, but thanks to pgary, I indeed got my penfed card, and was only assessed 1% surcharge on the rate (compared my exchange rate against prevailing historic rate) + 1.25% will be coming back as a cash reward. Thus, net "profit" of .25% on foreign charges.

One thing I will add to the discussion is that the turnaround for the credit card approval was extremely fast. From online registration with penfed.org to receipt of card, it was only 7 days!! My CitiAA and United Visa took at least 3 weeks!

So anyone planning a last minute vacation (like I did) can apply and still have a chance to get the card in time.

Also, as pgary mentioned, it's likely that you have an affiliation to join the penfed credit union. If not, you can pay a nominal one-time fee to join an association (but continuing in the credit union is not contingent on remaining in the association).