Just returned with the family from Madrid.
Before I left I had read all these reports on this site and was very concerned as we had kids with us. Well not once did we feel at risk or threatened. We looked life typical tourists - shorts, Nikes, cameras etc. We were aware, as we are in any big city we visit around the world - but felt extremely safe in Madrid and the whole of Spain for that matter. Must mention though that outside one of the Exchange booths we were approached by two men to exchange our dollars with them for a better rate - which we ignored and continued with our business.

How great to hear a "we looked like tourists and no pickpocket horrors happened"!! Maybe they go away with the august crowds!