is to show the timecode. As I understand it, that is a common practice "to allow the client to determine the exact frame(s) where additional changes should be made", while offering some measure of protection for you.
There are probably other ways, but it's not likely a client would want to display or distribute the footage with the time-code showing; it's just too annoying.
You can always put a watermark in the video. This could be your logo or the word demo or sample, etc. This, in addition to the timecode, would certainly make it unusable by anyone.
If you don't trust the client to this extent you may want to re-address whether you want to work with him to begin with.
Also, in the future (if you haven't already done so) have a letter of agreement between you and clients spelling out the spec work and what can and can not be done with the end product. This will create a record for future use and protection.
You could watermark your footage with a semi-transparent logo, too. I'm not sure about other compression programs, but the new version of Sorenson Squeeze (v. 5) allows you to add a graphic to your clip during compression. You can change the opacity so it can go from being a full-on logo to a faint bug. In any event, this graphic will be on each frame of the video.
If you don't have compression that will allow this, you could create a duplicate sequence in your NLE, and then add the bug/logo on a track above all the others, and then tweak the opacity to taste. Render out using whatever compression software you have, and you're on your way.
This is pretty common practice--watermarking, that is. Don't feel weird about doing it, especially if you haven't been paid for the project yet.