Hehe.... now I am also blur liau...

Now let see if a noob like me can make some sense to myself, so correct me if I am wrong. This is what I understand so far.

A lock 3G iphone is a phone that is sold by a certain telco in that particular country with a contract like 2 year at an attractive discounted price like US$199/. So in order that you stick to the contract they program the iPhone so that it can only use its own SIM card which is widely known as a LOCK phone.

So currently there is NO SOFTWARE available to UNLOCK a LOCK 3G iPhone. The only to unlock is via a Turbo SIM or physical modification which I read from here is a big NO NO.
.... so far am I on the right track
Now about Jailbreak commonly know as JB.

All iphone Lock and Unlock can only install approved apple iphone software from itune store so in a sense it is in a Jail.

We need to JailBreak it in order for us to install 3rd party software via Cydia or Installer or SSH to the iphone.

A LOCK iphone can be jailbreak but still LOCK to its own telco carrier
An Unlock iPhone if not modified would still be in Jail.

Am I making any sense... 

jackdon