Thanks for all the info, I'm going to Mexico for a month in a few days, so I'll probably wait until I come back. Apparently her brother has an old iphone there we can have, but he says it's "locked" I guess to a carrier there.. So I'm assuming that's what "unlocking" is actually for.
I think I'll end up with an S2, but waiting to see the iphone 5 will be an advantage either way.. There will be teenagers who spent $600 on an S2 and then decided to go iPhone 5 and sell their slightly used S2's. I haven't had a contract in like 12 years, don't think I should start now.
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