Selecting 2G only definitely does not disable mobile data. It just makes it slower.
Quick Settings application has a toggle for turning on and off mobile data. I use it in conjunction with the 2G only settings for preserving battery power when I'm not using mobile data.
I have experienced problems, though whether it's with the quick settings or repeatedly toggling between 2/3G - fairly often I'll have to restart the phone to re-enable data. Perhaps one should be done before the other, I may investigate tomorrow.
But yeh, Quick Settings has the toggle you're looking for (along which a bunch of other handy options)