Amongst phone fans (i.e. anyone who reads the phone websites) it's common knowledge that the Galaxy models sold in the US are different from those in most of the world. At the level of different radio bands that is common, of course, but Samsung are the only ones I know who use different processors in different regions (but also the only ones apart from Apple who make their own processors).
But as for your O2 contract, WTF? I thought it was absolutely standard that these things went to monthly at the end of the minimum contract period, and don't think they can lock you in again unless you signed a new one (which could of course happen if you changed your tarrif, whether you bought a new phone or not). Admittedly I've been SIM-only for 20 years now, but I know for a fact that's what my provider (EE) do, and really wouldn't have thought it legal to do anything else. I suppose you could write into the contract that if after 2 years you don't cancel/change we'll lock you in again, but that's the sort of thing that would not stand up to media or court scrutiny, so I'd be surprised if they were so stupid.