I am wondering if I can run CyanogenMod on a phone without service? I have an HTC Incredible and am thinking of upgrading to a new phone and wonder if I can give my old phone to my daughter to use like an iTouch works where you only have internet access via a wireless connection and cannot make cell phone calls but can use applications.
Yes, even plain Android will do this. I've heard of some unlicensed phones that didn't properly finish setup unless you had a SIM card but it shouldn't be an issue with CM.
I used to have an Incredible - moved on to a Nexus! - and I noticed a ROM in the XDA forums that was for Wifi only, ie, device without a data plan.
You can search here for it.
There is also a Wifi only mod that can be found here.
Link to Wifi Only Thread.