I live in Mexico too and I have no issues. Everything that happened to you could have been avoided if you planned accordingly before you left your home. For example, you could have pulled out cash before you went out to splurge, checked your settings on your account to make sure it still shows you're in Mexico, called USAA in advance....
Getting your card shut down by USAA is a security feature that has helped me in many situations. You dont even have to call to rectivate it. Just log in to your USAA app on your phone and reactivate it. USAA baking is all digital. If you call they are just going to walk you through the process on your phone. I been with USAA since 2005 and their customer service has been outstanding.
Rule of thumb, never go out without cash in your pocket. Credit cards are not reliable and not always accepted. Mexican cops dont take credit.