You probably could but it will mean unlocking it, and I'm not sure if you will have to jailbreak it too, which invalidates any warranty etc.
I don't think it's worth it for the amount you may save, IMO.
Nope, factory setting is that, complete reset with no trace. People tend to get a bit scared round the topic of jail breaking but I don't see the fuss.
Especially now it's been given the legal go ahead (always hated apple being able to have such tight control over a product that you own)