i actually work for a large multicarrier telecoms company. I get to see a lot of crap marketing and listen to a lot of moany people who take no care whatsover over what they want, as they only see the "free" devices they are being offered. They all gloss over the fact that they are entering a contract and that the documentation they get tells them what to do. I should point out that i am not a customer service advocate, but look into customer complaints as part of a general adherance to legal and regulatory process.
If this bloke's story is true, then he clearly waited longer than 14 days to complain, and even then didnt actually demonstrate a lack of signal because all mobile companies will disconnect a customer who simply cannot use their handset due to signal issues (given some offer of returning said handset). More likely is that the phone doesnt work in his house and that annoyed him to the point that he decided to blame O2 for every little mistake. £400 for an emergency phone? the bloke has very poor judgement if you ask me.
It happens with all operators (t-mobile used to be quite bad for inhouse coverage) and it happens with all devices that need to connect (especially laptops, where the 3g coverage in houses is rubbish on most networks).
I get sick of hearing the whinging, but in some cases it is justified. if O2 offer "unlimited" broadband irrespective of whether you LLU or not, then thats what you get. 10 gig is bugger all these days so they shouldnt really be bandying that number about. The biggest gripe with that sort of thing though is the fact you have to pay to tether to the iphone even though you have unlimited data on that. No other offering is as restrictive and it seems that Jobs can get away with blue murder.