I'm 31, and so cell phones and the etiquette were kind of forming while I was in college. I remember that freshman year, noboday had one, but around sophmore year, we were having conversations about how rude it seemed when people were walking around campus talking on their phones, but by senior year, probably a third or more of the students had one.
Right after college, I took of on tall ships for a little while, and I haven't had a land line since - when I moved to Chicago, I bought my first cell phone, and have used it as my only phone line since. It is far better when I'm travelling by ship to be able to keep in touch, get voicemails, etc.
About two years ago I bought one of the iphone 3Gs, but it's been very worth it. I accidentally snapped off the ringer switch about 3 days after buying it, but since I never use the ringer, it hasn't really bothered me for the past 2 years. I keep it in my pocket, I can feel it vibrate when it rings, and if I'm occupied, i don't answer it.
Having the ability to get my personal email (blocked from work computers), get weather (critical sometimes on boats or while on a construction site), use maps (running around to do site visits on projects I've never been to before, walking directions when we were turned around in some backwater Paris streets, driving directions in a city I don't know) and read books (i made it through about 25 novels this summer on my phone) while flying or riding the train, all make it well worth it, though i think I pay too much for a plan (~80/month with fees and such in). The utility I get is worth it, though I'd consider getting a ipod touch to use as a pocket computer and get a disposable cell phone for calls, the data accessability while moving and not on a wireless network is key.
For conversations, it's like anything else - some people have no manners. I don't interrupt a conversation unless I'm expecting something important, in which case I've probably told them before hand (I have warned dates that I may answer my phone during a date because I was the land contact for friends doing a boat transit and was an emergency contact, or when my dad was in the hospital). I assume that any conversation in a public area is publicly heard and limit volume and topic accordingly. people have loud and annoying conversations and arguements all the time without phones in public - same matters of etiquette apply regardless of the means of conversation.