Here's a rant of mine from a while ago to help clear up the confusion:
3G is not the same as data
2G is not the same as "EDGE"
3G UMTS networks can provide the ability to handle calls, SMS and data.
2G GSM networks can provide the ability to handle calls, SMS and data.
Turning off 3G will not turn off data access on your phone.
If your carrier allows you to connect to a 2G GSM network that offers data services through GPRS or EDGE, then you'll still be able to connect to the internet when the "Enable 3G" switch is toggled to off
Some carriers don't support EDGE at all and most don't have EDGE coverage across their entire 2G network.
iOS 5.0 and 5.0.1 do not support the 3G switch on the iPhone 4S only. The switch is re-enabled in iOS 5.1 which is being released today.