Is there any practical/technical/security problem with simply printing off and mailing a buttload of cheques to people that request them?
If you cash over ¥ 1,000,000 via cheques you have to specify it with the Japanese customs office. Have fun! In Germany it is partially prohibited to redeem cheques. I have never cashed a cheque from Japan and do not know if that's possible. My last cheque I have got about 10 years ago from my old phone company. I first had to figure out how I can redeem the thing. It was just possible, but unusual.
Really, I think in this case it would be easier to send money via Western Union. Cheques are antique and cheques from foreign countrys are mysterious. I never ever have received something like that.
It's not really about cashing the cheque, that's what the end user does, it's about creating the cheque.
What's stopping or making it difficult for MtGox to *create* those cheques and mail them out?