Funny story, but I question whether this was true. The more likely scenario would be OnStar would suspend their service for non-payment, not lock you out of your car.

Edited to add: Per OnStar's T&C:
26. OUR RIGHT TO TERMINATE OR SUSPEND YOUR OnStar SERVICE.
...we can terminate your service if you breach any part of this agreement, don't pay amounts that are due to us or one of our service providers...
http://www.onstar.com/us_english/jsp...conditions.jsp

No mention made of holding your car hostage if you fail to pay up.