I checked the IMEI number and it says the following:

Your IMEI Number is currently blocked by Telstra since 24 November 2009 8:29 AM

What does this mean?

Personally, im not sure.
But it sounds suspicious.. go down to the pawn broker and ask whats going on.
Say your fears of it being stolen and ask to be reasured about this..
because if the gps finds it at your house, they may think you stole it, when in fact you have not.. and if you paid your good money on this phone, it should at least be yours, not someone else's property.
I hope it isn't stolen and its just a technical fault.. but you need to clear this up ASAP.