I don't think my problem is with echoes, but general noise and static when using headphones. When I first heard it I thought the other person was in a noisy place (and he had trouble hearing me), but it turned out he was actually in a relatively quiet office environment and all the noise came from my phone. Subsequently, I've found I can hear this noise the moment I tap "Call" and the other phone starts ringing.
It is more noticeable when I use noise isolation headphones (a relatively new Sennheiser set), but even on the Apple headphones I can hear static while in a quiet room, and my voice is amplified. That's when the calls are good. When it's at its worst, people can't hear me. It's as if there are other people speaking in the background, but in a distorted jumbled way.
Today I just tried to get my iPhone 4S 64GB replaced. I tested 2 replacement sets, but both had the same problem. The worst part was the service people could not hear any noise when it was so obvious to me! They only spent a moment to listen, however. I decided to keep my original unit because the two new ones had yellow screens. (They refused to open more than 2 for me to test.)
Since this problem appears to be prevalent on so many 4S units, I have wondered why there haven't been more complaints. My conclusion is those other people either don't use headphones to make calls or their hearing just isn't as sensitive as mine and everyone else who has posted on forums like these. I'd really like to say they are half deaf, but I am trying to be polite.
I really hope this is a software issue, not hardware since I would have to be very very very lucky to get a perfect replacement!