Hey guys! Boy do I have a story for you...
My friend went out and bought the G1 yesterday, excited to try out the 'Google Phone'. After being assured by salespeople at Best Buy that it would work with Pay as You Go, guess what? It didn't.
After popping in his SIM card and powering up the device, it forced him to register the phone with his Google account. No problem, except for the fact that it wouldn't let him use WiFi and it also wouldn't skip the registration. In other words, he had one very unusable phone.
Calling up a T-Mobile store, the salesperson there confirmed that it should work and gave him the number for support. After having support hang up on him multiple times and still keep trying to convince him that it should work, he got transferred to someone who understood his situation and convinced him that it wouldn't work. It doesn't sound like T-Mobile people know what works and what doesn't. So, in the end, he returned the phone to Best Buy very frustrated and he is going to wait for the 8900. A good choice ;)
Have you had any run-ins with carriers? What was the end result?