This year, though, the relatives moved to Canada. When I entered the codes I got this error message:
Your iTunes Store (US) does not match that of the gift certificate (Canadian).There's nothing about this in the iTunes Store - Credit Card FAQ.
I sent a support email to Apple. I want to at least get a refund back to our relatives.
Apple should include notification of this limitation during the purchase process, and they should have support information on their FAQ including an explanation of how to obtain a refund.
I'll update this post with Apple's response. If the response isn't satisfactory, I'll suggest my relatives ask their credit card company to contest the charge.
Update 12/26/08: Apple has thus far processed one return, I'm hopeful they'll refund the other two certs my in-laws sent.
Update 12/28/08: iTunes support says they've all been refunded.