I believe it would be possible to create a secure physical bitcoin currency using QR codes. Here is how I believe this could be done:
First people would print their own bitcoin denominations that have a special QR code that initially corresponds to their bitcoin address. People can print bills in any denomination they choose. A system would have to be set up that allows for the transference of the encoded qr data once a transaction has been verified. People will access the QR code through a special bitcoin mobile app that will verify a transfer. Both parties must access this app and the qr code on the bill to confirm the transaction, hence no stealing.
What are people's thoughts on this and has it already been done, and if not, why not? Lets do it!
Things like this have been discussed. It's just a matter of coding that app and letting people print as they wish.
You may also wish to search for BitBills.