'3' network mobile phones

[pigface]

I have a phone on the 3 network (18mth contract) and the phone itself (Motorola RAZR V3x) has awful battery life and reception which makes it virtually unuseable. I could get the handset repaired but really I want a new phone (one that works properly). I don't want to pay out any more that I'm paying at the moment. What are my options?

Once my contract has finished I am hoping to go pay as you go.

I have tried putting my sim in my boyfriend's Sony K550i which is on 02 and (quite unexpectedly) I was able to make and recieve calls. Are there any unforseen problems with me using a 3 sim in an 02 (non 3G) phone?