So they started selling unlocked iPhones a while back at the full retail price. If I pay 649.00 bucks for the phone, does it come unlocked?
Whether or not a phone is unlocked does not depend on how much you pay for it, it depends on if the phone you pay for is unlocked. If the unlocked model is available and you buy it, it will be unlocked. If the unlocked model is not available and you buy a locked model, but for whatever reason pay beyond what the locked model costs, it still will not be unlocked.
The unlocked phones are sold at apple, not AT&T. A full price phone bought at AT&T is locked, unless it says otherwise.
Given that the UK Apple Store site says that the 4S begins at £499, it's safe to assume that Apple is going to continue selling unlocked iPhones here in the UK.