I don't use mobile phones because of costs and annoyance factor, but my current 8gig ipod touch is very limiting in space. I want to upgrade to more memory.

I see a 3g iphone for $75 on ebay --- will the ipod and camera fully function without getting it activated?

and since I live in england, could I maybe use a pay as you go sim card if I wish in the future??

Thanks, Howard from England