How can I use my old iPhone 3G as an iPod touch?

See Here for Details...

Use iPhone as an iPod

http://support.apple.com/kb/HT3406

http://support.apple.com/kb/HT3406

Trying to do this following the directions in the KB but the sim card in my iPhone 4 is a different size than the one in the 3G.

Any other ways to convert the 3G to an iTouch without a live sim card?

No, the phone has to have the deactivated SIM card that was last used when the iPhone had cell phone service. No way to to this without a SIM card.

After my new phone was activated and thus the old de-activated this just worked. I guess in essence I did what the article said since the old SIM was still installed and I just re-synced my old phone.

I think it is really sort of easier than even the article suggested.