I use an app called TextFree I believe and it's worked great for sending and receiving SMS messages. At the time I dwl it, text plus was giving some users some problems but those bugs have probably been worked out by now.
And the contract claims it's truly unlimited, but there's also a disclaimer where AT&T states basically everything but browsing the Internet and email is prohibited so apparently they wanted the right to discontinue unlimited service to anyone using much bandwidth if they choose.
I'm no legal expert, but that's what I understood when reading the agreement upon signing up for the unlimited plan. If I wasn't under contract Id consider using the iPad for all my phone calls with Skype, because I don't talk on the phone much, mostly just text.