I'm curious if you had to pay the fee or not. I intend on purchasing from Costco when they open in about 3 hours. I'm going to show them the article if they give me any flack, and I'll post back here.
Update: Verizon's been in touch to inform us of a policy change: customers who purchase the off-contract Xoom will now no longer need to be on a month to month plan. That said, we still see "Month to Month" as a compulsory option at the time of updating this post.