Banks can make money in other ways - in many parts of Europe banks don't charge overdraft fees - they just charge you a monthly fee to cover the cost of providing service. Other banks (e.g., ING Direct, Uno-e) in those same countries provide accounts without fees, and without access to a branch network. You can choose what service level you want without being screwed over by the bank.
No they only guarantee to honour cheques up to the stated guaranteed amount. Usually this is £200 but can be more or less.
Highly recommend them. Take pictures of your check with an iphone to deposit. They cover other banks' ATM fees up to $30/month, so that's pretty much eliminated as well (for me, at least).
Or are you using "checking account" as a loose term? I always assumed it meant an account one could write cheques from?
Is that even possible.
No account with a cheque facility could prevent you making an unauthorised overdraft. Nor indeed could it have Maestro (et al.) as balance is not normally checked when making authentications or done as part of the purchase process. So it would have to a cash only account... and then the chance of the bank making money from you must be low; meaning they'd probably have a standing charge?