Italy has been the worst in my experience with pickpockets. We've never been targetted in Spain, probably because we've gone so many times that we're practically not tourists.

But in Italy, we were taken by three "gypsy" girls (that's what they called them, sorry if that sounded really racist) came up to us. One held a sign asking for money, covering my dad's line of vision to his pocket, while another grabbed the wallet out of his pocket. A third, underaged girl, was left behind to be "caught" by my dad. Since she was only 12, the cops couldn't do anything to her.
I was 14 at the time, and since then, I've been much more cautious. When I see those kinds of people begging for money or selling things on the street, I just ignore them and keep my distance. They've gotten in my face, yelled at me, used babies to pity people, even put their kids up to dirty tricks, but I just can't trust 'em. They're desperate for money, and it's sad that they need to resort to these tricks to buy food to eat, but no one wants to be robbed, so it's best to come off as cold-hearted than be stuck without money and important documents.
Material girl: I'm sorry about your parents. Southern Spain is nice, but VERY touristy compared to other parts. It's like a breeding ground for thieves. That really stinks that your parents had to go through that just as they'd started their vacation.

Did they enjoy/Are they enjoying themselves, at least?