Why can it not find a network? Phone or provider?

Hi,
Need help...
Bought iPhone 4s locked to orange from eBay on ios 7.0.4
Got the phone, connected to iTunes, was already default factory settings, restored by previous owner...
Activated phone, placed orange sim in when asked in but all I get in the top left corner where network should be is "searching"
Checked sim, worked in an older mobile, network coverage good.
Tried virgin sim too, (aware could work on orange network) and although recognised card, ie asking if I wanted to transfer virgin settings over, still had "searching" in top left corner.
Contacted apple, did reset, restore etc, they told me to contact orange regarding this issue to make sure that they have updated my account with the new IMEI number.
Contacted orange, technical dept said could be due to the fact that the iPhone may still be on contract, and me placing a different sim in it is confusing the phone.
They asked me to get the previous number the phone was contracted too.
Did that from the seller, phoned orange back up and told that doesn't matter, doesn't make sense what I was told, contract info is on the sim, not phone so doesn't matter, in any case couldn't use the number as meant looking at another persons account...my sim as far as they are concerned is fine...
Help... Is it the phone or is it the network, ie sim or the fact it was previously on contract
Thankfully seller understanding, should get money back, but not sure what to do next...
Thanks
Chris

Sorry, sent before completed above post...
Relates to a question, can an orange payg sim work in an EE phone...
Conclusion is it cannot. Although listing for phone said locked to orange, it did arrive in an EE box.
Original link to thread below
http://discuss.howtogeek.com/t/orange-sim-in-ee-phone/1908
Don't want EE sim contract, too much for me, lol
Thanks
Chris

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