For several weeks before Christmas, Apple blogs were buzzing with rumors that Wal-Mart would be selling a new version of Apple’s iPhone at $99. But instead, Wal-Mart confirmed it would carry new iPhone 3Gs starting Sunday at $197, not $99.

AT&T’s $99 refurbished iPhones are the same models, but slightly used. The heavily discounted iPhones still require a two-year AT&T contract.

Refurbished phones are previously owned devices that have been unused or lightly used and returned during the 30-day trial period. They are independently quality tested and loaded with the latest software to meet current factory standards. While some refurbished devices have minor scratches, all carry a warranty of 90 days or more.

The refurbished iPhone 3G sale ends Dec. 31 or when AT&T runs out of stock, whichever comes first. [Mobiledia]