after reading the replies, i was going to take the advice of going back to the store to see if they could help, but with it being some ridiculous morning hour i checked the o2 website for any help.
luckily they have an iPhone help section which tells you how to activate the 3G network on pay and go.

if anyone needs help with this too, here are the instructions:

"* Go to settings menu, choose General
* Choose Network, then Cellular Data Network
* In the APN box, change mobile.o2.co.uk to payandgo.o2.co.uk - you don't need to change the user name and password
* Finally, turn your iPhone off and then back on again and you're done."