If as previously mentioned, your phone is not already unlocked, you have to jailbreak your phone in order to then unlock it.
My experience has been with ATT and Telcel (Mexico). I have an ATT plan/phone and did the two step procedure (jailbreak/unlock) to use the iPhone w/Telcel chip while in Mexico. Works great as a phone, and no problems with wifi. That said, I'm unable to access the usual features associated with 3G with the Telcel chip.
I enquired about purchasing a iPhone chip only from Telcel but they would not sell it without the accompanying phone and a 1 or 2 year plan (shades of ATT). Not that big of a deal, as there are plenty of wifi spots available if needed.