iPhone 3G 16GB = $299
Premium over usual data plan price over 2 years contract = $240 ($10 x 24)
Total iPhone 3G 16GB 'cost' = $539

So it's pretty similar with apple's previous pricing of $499, if you consider some sort of interest for the $200 portion that gets spread out over 2 years.

As for the carrier lock in... yes, in one hand they rob you of a choice, but the carrier can calculate a certain income for a certain period where they can justify an amount of investment on their infrastructure. If they're not being an ******* about it, this could be a mutually beneficial arrangement. I think the 90% satisfaction rate from the 1st gen iPhone user speaks volume about it.