This could be big.
I agree the main point should be incentive to have more people mark new bills.
Here is the idea I have for now:
1. Mark on $1 bills (yes, ideally this works anywhere but start with U.S. for simplicity) the following: thebitcoingame.com or unlockmysecret.com
2. A curious person goes to the website and is congratulated on finding a game worth real money. The object of the game is simple: rack up the most miles traveled for their bill as possible. All they need to do is enter info from their bill (e.g. serial number and plate number)
3. The website enters the bill info and geo location of the I.P. address then calculates the distance from last entry if any. This is added to the user's score.
4. On the 1st of every month the top 3 users with the highest mileage score receive Bitcoin prize reward. This can come from donations and site advertising. There is no limit to the number of bills a person can register, but the bill they enter only is worth mileage for them to the next entry, then it transfers to the next user.
5. The site displays a running tally, and possibly other interesting info like where the bill was received etc. to add interest. It could be bigger than wheresgeorge.com. Of course, there is also a simple introduction to what Bitcoin is.
6. There can be a big bonus if a user enters any bill that they entered and later found its way back to them.
To prevent gaming the system: as mentioned earlier each bill has different security features which can be used to verify the user is holding it. The other problem is spoofing I.P. addresses, which is possible, but it's harder to spoof I.P. location over and over. Also, the I.P. might be required to come from Starbucks or McDonalds both of which offer free wi-fi nationwide.
It's a good idea, but wouldn't work very well. You can easily have access to IP addresses from all over the world if you know what you are doing.
I wonder if it is possible to filter for only ISP-given IP addresses. I mean, gather up the IP ranges for all the major ISP's around, and then see if the IP fits the criteria. If not, throw an error and tell them they must enter their bills from a residential ISP carrier.
Then again, people would start creating IP address circles. Mailing lists with lists of serial codes, and they just keep circulating them round-robin style. Of course, that could/would happen with any of the methods talked about so far...
Hmmmm...
Also, 6 wouldn't work, because a person could just keep a log of the serial numbers, then periodically re-enter them to see if they had been entered somewhere else and thus "returned".
EDIT: An epiphony! Only pay out for the first bill entered for a second time every 24 hours. In other words, it wouldn't be normally expected that the same person could find two bills that had already been written on it in the same 24 hour period, so anyone who does would be considered a cheat, and would not be paid out for that bill. BUT, a person can enter as many first-time bills as they want in any given period of time. Thus, the incentive to write on fresh bills would likely outweigh the incentive to cheat on existing ones!
You'd still probably have rings of people trying to enter each others bills to game the system, but ultimately, it wouldn't really be worth it for them. And it would probably be much easier to catch them just running some simple queries on the DB.