Trouble activating a launch (2g) iPhone

I'm having some serious problems (re)activating my launch (2g) iPhone. Not sure what's going on. Details below....

I have an old launch AT&T iPhone, purchased way back in July in 2007, still working. A few years ago I switched to a different phone when AT&T said they'd be shutting down all EDGE towers state-wide. That didn't actually happen (not sure why) so now I have a perfectly good launch iPhone that could still be used.

With this in mind, I went to AT&T and got a new SIM card from them to use with the iPhone. I swapped it out, wiped the phone completely (factory restoration), upgraded it to the latest iOS available (3.1.3), wiped it AGAIN, then plugged it into iTunes to activate. Everything seemed okay at first, but when I clicked "activate" it skipped over any of the usual steps and went straight to setting up my sync preferences. No selecting phone plans, no SIM activation, and most importantly no phone number assignment.

I've done this process in a variety of ways over and over. New SIM card, old SIM card, wiping via iTunes or through the phone itself, using an older version of iTunes, nothing seems to fix it. I'm unable to activate my iPhone as an actual phone. What am I missing?