I visited a Pocket store today and found out a few things:
1. Bring in any Verizon, CricKet or Sprint phone that can call customer service and you get a $30 discount on a new Pocket phone with new service.
2. The $40 rebate on the Motorola v120e (old phone) is actually only redeemed after you've paid for three months of service (four counting the first "free" month) of Pocket service. Not too horrible, but it's not an instant deal, and it may not be worth waiting that long for a truly free phone.