start-up
The cheapest handsets will go for around 800Y in the blue-signed China 
Mobile shops you see pretty much anywhere.
If you really want to show off - and you do, don't you - then you can spend as much as you want.
You can maybe haggle a little off, or get them to throw in some free accessories. Expect to add on upwards of 100Y
for a SIM card and number. Numbers are priced according to how memorable or 'lucky' they are considered to be. If you are
short of cash you might find a second hand one by putting notices on noticeboards, and if you get really lucky you'll get a Sim-card full
of phone-numbers into the bargain.
If you already have a handset from home (and it isn't slaved to your network) just stop by the China Mobile shop and point at your mobile muttering 'Shenzhou Xing Ka'. If your phone IS slaved to a certain network, get it unblocked before you come - phones sold in China are never slaved to a network, and therefore it's impossible (ok, maybe not,but I don't know where or how you could do it) to get them unblocked.
running
Cheap. So cheap I have little idea what they are and unless you are on a very tight budget you don't need to know either. Bear in mind you pay for both outgoing and incoming calls though. Of course, I'm a light user, mainly SMS's to keep me from falling asleep at work and quick 'where are you, I'll be there in five minutes' calls.
I buy 100Y recharge cards about once a month (although they've replaced the plastic cards with little envelopes you open up to get at the slip inside). They're available in loads of places, the most useful probably being newspaper kiosks. Recharging is simple, as long as you can manage to press '2' to get the English option and already know that they mean 'hash key' when they say 'pound key'. It's normal to use the recharge when you buy it, I think because fake cards were once sold, so don't be surprised if the kiosk owner takes a break from yelling 'Beijing Wanbao' to run after you and insist you recharge your phone right there in the sandstorm.
The card
Unless you are going to be a really heavy user (in which case you are doing business and should be getting your PA to worry about all this stuff) I recommend a Shenzhou Xing Sim Card. These are pay-as-you-go, and require no registration other than getting the salesperson to activate it for you. They are valid for something like a year or 18 months after your last recharge. There are other options where you are billed monthly, but you will need proof of address and so on.
Language issues
I've never heard of mobiles that only operate in Chinese. They may be preset to use Chinese menus, so check before you leave the shop - it's a simple matter to change the language. Some models offer the option to SMS in Chinese, using a range of input methods, you may want to make sure you get a phone that can do this. You can expect all guarantees and instruction books to be in Chinese.
The coverage
Basically, everywhere there's concrete. Coverage is so extensive, I suspect they use higher power transmitters than are allowed in the West. You can't phone in the middle of a subway ride, but you can write an SMS and send it as you pass through a station. Shenzhou Xing cards can be used in other provinces (I've only tried it in the North East , can anyone vouch for other areas) but charges will be slightly higher.
The concept
I've not yet been to a Chinese funeral, and neither have I yet found a situation where it is considered rude to use your mobile phone. I've come to the conclusion that it's just acceptable to use them in meetings, job-interviews, consultations with a doctor and cinemas. I still tend to set mine to vibrate in these situations out of force of habit, but I think you can safely use it in nearly any circumstances. You will be asked to turn it off sometimes, such as the aforementioned theatres and the queue for passport control at Beijing Airport (damn it, I just turned it on after getting off the plane) but most people seem to regard this as optional.
Remember that both parties to a phone call are charged, and therefore it can be considered rude to have a long conversation - especially if you started it. It's common to let a mobile ring once and wait for the recepient to call back from a land-line.