The only time I've seen one (actually the first time I learned about them) was at an outdoor market where I bought some handmade jewelry. The woman kept it around as a novelty alternative to her phone-dongle card reader.
The taxi drivers in Edinburgh used them until about 8 years ago. Then they were replaced with mobile phone based payment, then finally with chip and pin. When they used the mechanical impression machines, they wouldn't accept card payment from on-street pickups due to the risk of fraud (as perceived by the driver).
The other place I saw one used c2008 was when buying a ticket from a guard on the platform at Kings Cross after I missed my train. Then the ticket price didn't show up on my online card statement for about a month.
It's rare but I've seen them < 5 years ago in remote locations where electricity isn't everywhere (like rural tourist destinations).
I love them - makes me feel like I'm leading the travel high life in the 1970's. (same feeling I had when landing in Tunis national airport - cash exchange registers, competing with each other on rates! Actual coin operated pay phones! Loved it)
They're still kept around as a fallback in case the POS system goes down. At least, that was the case when I worked as a grocery store clerk 7-8 years ago.