This is already done in Israel by Bezeq International, the largest ISP in Israel which is owned by the national phone company. It works exactly like people expected here... You pay more, the use KY so it hurts less.

Almost all Nokia and Sony-Ericsson phones, even dumphones, can tether via USB or Bluetooth out of the box, there is no need for an app for that. Actually, you can get Nokia 5310 from T-Mobile, get the $10 dumphone unlimited web and tether with that.

T-Mobile USA uses 25.0.0.0/8 for their NAT endpoint addresses. This is not some IT department in a bank, this is a telecommunication company. They should know better.

Are there really businessmen using iPads? The iPad is far from being a business oriented computer.

This story smells like a hoax to me. All the reports seem to be same, offering no real evidence that such a botnet exists. Knowing the admin password allows local attacker to configure the router and even upload a custom firmware, but remotely zombifying routers is much more difficult.