I wonder if someone can sniff the exchange between iTunes and Apple when the unlock is performed, and reverse engineer the unlock process so it can be used on in-contract phones?
If they can do it this easily it shouldn't be that hard to crack, right?
Locked phones (of any brand, not just the iPhone) each have their own unique unlock code. This wouldn't work.
Not that you enter it on the iPhone -- it's a part of the communication with iTunes when you do the sync after your request. At best, you could uncover the code for your specific phone by sniffing the exchange.