I was teaching when the original TI-83 came out - the earlier 81 and 85 came out while I was in college. At the university I taught at, we actually required students to have a graphing calculator for certain classes.
At the college level. it isn't hard for a good teacher (or textbook) to ask questions that actually test the student and not the calculator - at least, unless they have one of those algebraic calculators. Even then, things like word problems require them to identify the right formula and set it up properly (which is more important than actually being able to grind out the numerical answer from there).
Having said that, I'm not sure how some elementary school teacher is supposed to teach fractions when even fairly basic calculators can handle fractions these days (some even displaying the result as you'd write it on paper). Require students to have a specific level of calculator for each grade? I'm sure that would go over really well with parents ...
Of course, I already have one of the Casio CG-10 calculators.