OK- my son, the tech monster in the house, has switched my sim card to my husbands iPhone and I will try this on both....
Does it not seem odd that my husband- who already has an iPhone is now eligible to upgrade at discount a mere 7 months later? My thought, and they are not from my happy place, lol, is that they know they cannot play on and manipulate his lust for an iPhone since he has one already.
It's not odd at all--it makes sense. Your husband is eligible for the cheaper price because he paid full price for his original iPhone already. Everyone else who is a non-iPhone AT&T customer (like you and me) however, got their phone at a subsidized price, meaning AT&T paid for part or all of the price of the phone, and makes up for it with a 2-year service contract.
AT&T lost money from your subsidized non-iPhone phone, which is why you can't upgrade to an iPhone without paying full price. However, AT&T didn't lose any money from your husband's original iPhone, and thus gets a subsidized iPhone 3G (which of course they'll make back with his 2-year contract).
What's going to be interesting is what AT&T is going to do if Apple releases an updated iPhone after a year--all the people with subsidized 3G iPhones will still be under a 2-year contract and I don't think AT&T is going to allow those people to upgrade to the new one (if one does come out) at a cheap price.