Getting 3g to work with my sim card

[imlofo]

I have been searching several forums and am not sure what I need to do, but here is my situation. I am currently an ATT customer using an LG Incite (POS) without a data plan. A friend just gave me his old iphone 3G. It has his old sim card and I can access wifi, use the camera, etc, but no cell service. When I put my sim card in, the phone asks me to connect to iTunes. When I do that, itunes pops up saying I need to accept the data plan in order to continue.

What I would like to do is use the phone with my sim without accepting the data plan screen in itunes. I realize that ATT may add the data plan anyway, but I am hoping that since I am currently using a smart phone without data, I can continue with a different smart phone on the same contract (probably wishful thinking). Anyway, what do I need to do to get the phone working with my ATT 3G sim.

iphone version 3.1.3
modem firmware 04.05.04
I can use windows xp or OS X to work with it.

Should I unlock, jailbreak, upgrade, or what?

Thanks in advance for any help.

[area51crypto]

As far as I know all AT&T iPhones activate through itunes.

Also from what I have read in these forums if you put an AT&T sim in an iPhone AT&T will know its an iPhone and add the data plan to you account.

Not good news but some news.