WingAndAPrayer, just to clarify why you don't want to use the ATMs here:
The official exchange rate for the US Dollar right now is about 5.82 pesos to the dollar, thanks to the government's attempts to keep their irons in the fire as long as they can with no thought (or no care) to what it does to the citizenry here. That is the exchange rate that the ATMS offer (give or take). GB Pound is currently officially 9.28 pesos to the Pound.
According to DolarBlue.net, the black market ("blue") dollar rate is about 9.4 pesos to the dollar or so (you have to average things to get what's generally accepted on the street - I got 9.5 a week ago at my cueva, wiring the money in, but that's a wholesale operation) and the GB Pound is about 15.15 pesos to the Pound.
If you change at the official rate (via ATMs), your money will be worth about 40% less than you could get it exchanging money with blue marketers. Of course, the problem, as stated, is actually getting your money into the country to begin with.
I haven't exactly followed the Uruguayan method of getting money from ATMs terribly closely, although there are some common sense issues that can be a bit obvious. One problem I'd have, personally, with going to Colonia is the cost. Of course, if it's the only way of getting money, there is no choice, but it's going to cost you at least (as of today) $500 pesos for a round trip to cross the bay and go to Uruguay. In dollars, that would be about $53. On top of that, you can only get out a certain amount per each transaction ($300 USD if I remember correctly), which means that whatever fees your bank charges, and whatever fees the local ATM charges, etc, will also be figured in. I'm not sure what the daily limit is - I know a guy who goes over there about twice a month and stays the night so he can get more money the following day - he has to factor in cost of hotel as well.
According to DolarBlue, the effective exchange rate in Uruguay, including all the fees associated with the banking transaction itself, is about $7.35, or roughly 22% less than the black market rate here. Factor in the Buquebus (the ferry company) tickets and possibly a hotel to beat the withdrawal limit per day and that effective exchange rate is even less. That is figured in dollars, to be sure, you might have better luck in the whole conversion process in your currency, but it will still come out less than if you had the cash here already and were looking only to change for pesos.
Like others have said, your best bet is to bring as much money as you can, and then find a way to get the money in your bank, for later, down here. I'm not one to encourage other people to break customs laws, but I know people who have secreted more than $10K USD on their persons when entering, that's up to you how you go about getting money into the country. You do take the risk of getting at least what is over 10K USD in value confiscated, but no one I know has ever been caught doing it. And they are more worried about foreign currency leaving the country than entering.
Also, Azimo seems like a pretty good bet (except for not accepting Irish bank accounts - that may cause you a problem as mentioned) for getting money down here. You won't get top rate, but after other methods of getting money here you'd probably profit better that way.
Money's just the first issue (and often the hardest to get around) when coming here. Make sure you are well-prepared to deal with as much as you can, before you come, or your year here could be a long one
