cdiver2, you are correct that there are bent cops in Thailand, as there are everywhere in the world, and perhaps there are more of them here than where you live, but this presumption does not offer proof in any way that the UK couple accused of shoplifting are innocent.
There are different perspectives to all stories--consider this one. As has been said, when suspected shoplifters are picked up here, they can generally choose to go the judicial route, in which they must stay in the country and attend their hearings in court, or they can settle out of court with the aggrieved party (the shop) and are then free to leave the country. This couple took the settlement route. You must be aware that out-of-court settlements are not fixed fines but are negotiated amongst the parties involved. The practice of settlements and subsequent dropping of charges is common practice in the judicial systems of most countries in the world.
Perhaps the UK couple felt their position was weak, (including psychological reasons such their lack of familiarity with the system, worry about getting back home, etc.), perhaps they felt intimidated and out of their depth in response to the petty nature of the crime, perhaps they knew they were guilty and cringed at the thought of the "Bangkok Hilton"--but regardless of their motivation, the fact remains that they made bail and paid an out-of-court settlement to have the charges dropped. As I understand it, the police at one point said the couple failed to reclaim the bail money, in the amount of THB 200K, once the charges were dropped. Who's to say if the settlement and the associated legal fees were reasonable? The accused agreed to pay; if they had refused, they would have gone to court.
Embassies can only get involved once a national is imprisoned, and even then, they can't do much other than make sure that conditions are humane and that legal counsel is available; furthermore, the process is not instantaneous--it may take days for a consulate official to meet with a prisoner. When foreign nationals are arrested for an offense in a country, they are subject to the laws and procedures of that country, and no embassy can shortcut those laws and processes. Again, this couple chose to go the settlement route rather than the judicial route.
There are plenty of victims of scams, cons, and outright theft who really do deserve our sympathy, but I have to say that IMO, if this couple from the UK had just kept their sticky fingers to themselves in that Duty Free shop, they'd have avoided this nightmare. They were on the wrong side of the law, they got caught, they paid the settlement, and now they cry crocodile tears about extortion?