Welcome to EIC, Dave.
To transfer contacts from a SIM to the iPhone, you will need an application called iSIM on your iPhone. To get this application, your iPhone will need to be jailbroken. For information on what jailbreaking is, what it does, and how to do it, go
here.
EDGE is a data network. To use it, your phone must be paired with a carrier. You need to either activate it with an account with the carrier it is locked to, or unlock the iPhone and activate it with an unofficial carrier.
Hotmail uses standard POP3, but it only works on the Windows Live Hotmail Desktop. Because of this, it won't work on the iPhone's Mail application, so you'll have to settle for webmail access.
- John