You don't have to be vegan to think that unnecessary cruelty should be avoided.
Certainly, cruelty should be avoided. I don't think there's even such a thing as necessary cruelty.
However, how do you know that cruelty is involved in production of the tallow in the notes? It sounds like what you are saying is that use of animal products is, by definition, cruel, and I would beg to differ on that.
If we look at the animal kingdom, most carnivores kill their prey in much more cruel manners than humans do. We generally take steps to ensure the animal is stunned before killing them.
In addition, AFAIK, tallow is generally produced as a by product of other industries, such as food production. There is logic to saying that, if the animal will be killed for food, anyway, why not make the best possible use of all parts of it?
I do believe the Royal Mint has made an error here, as there will be negative PR. However, if anyone wishes to stop accepting or using them, that is their right*. I'm sure it will be a massive inconvenience to them (for example, if they refuse a fiver as change in a shop, they'll either get a bunch of bulky, heavy coins or be told the transaction cannot be completed). But, then again, vegans are used to being inconvenienced (and inconveniencing others), so they probably won't mind that.
* WRT legal tender, see http://www.royalmint.com/aboutus/policies-and-guidelines/legal-tender-guidelines
In short, it is only a legal requirement to accept legal tender as payment of a debt.