Exactly. Why would anyone give up $100 or more for the convenience of "trading in" at an Apple store?

I just sold an out-of-contract (and thus unlocked) GSM iPhone4 for $250 on ebay. Not quite mint condition as a tiny ding on face but otherwise good condition. All of the popular trade-in websites offered $125-135. Glad to hear that I didn't miss anything at the Apple store.

If you want to upgrade your phone with AT&T or Verizon, your best route will always be to get a subsidized phone from your carrier and then resell your old phone on ebay or another reputable marketplace (there have been some robbery scams facilitated by craigslist so can't recommend that route). If you are willing to use a prepaid carrier like Virgin, GoRedPocket, Cricket, Straighttalk, etc. then you are probably better off paying full price for an unlocked iPhone and then amortizing the cost over a vastly smaller monthly bill. Note prepaid only works inside the USA so not good for many FTers who travel internationally