Using an old iPhone 3GS with a prepaid SIM
Yes, it is possible. That's how I used my iPhone 3G for the past 2 years. You can buy a sim card for pre-paid ("Pay-as-you-go") use, it should be $10 or so.
In my case I used the sim card that I had before in my old cellphone.
I asked at our provider and I found out that you can do the same for an iPhone 4 and 4S (use it with a "Pay-as-you-go" sim card).
All the best!
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Or you can buy a daily/weekly data plan if needed. (when no WI-FI)
For example Rogers (in Canada) just sent their new data plan for Pay-as-you-go: $1/day (10 MB data) or $5/week (60 MB).