I am a big proponent of selling old phones on ebay (or giving them to charity.) But one of the risks of purchasing a phone is that you will end up with a stolen one. Now the major cell phone providers have stepped up to the plate by making it possible to make stolen phones completely useless.
If your phone is stolen, be sure you wipe it before you have the cell phone company disable it, or you won’t be able to wipe the phone later on.
See Mashable’s video on the subject for more.
By the way, if you want to donate your old phone, I suggest checking with local abuse shelters. They are always in need. Call your local shelter or check out Sister Alliance.