Hi,
Found a workaround to the ** issue. Use your old cell phone, or buy a disposable one for $9.99 from RadioShack, put the speaker of the old cell phone directly up to the microphone on the bottom of the iPhone 3G (do NOT put the iPhone on speakerphone), when the prompt comes up, press ** on the your old cell phone. That will get you into the system, then use the iPhone to dial the rest of the numbers. Let me know if that works for you guys?
This leads me to beleive that pressing ** does not transmit any electronic signal it merely plays a split second audio file, and that on the iPhone 3G that sound is "off" key. Thoughts?