It's the way all mobile phone contracts work, regardless of provider. You pay for the upcoming month's tariff and that gives you your minutes/texts/data allowance.
All terms and conditions are available online regardless of if you are a customer already or looking to be a customer.
Sorry you feel misled but it is the way everyone works. Maybe O2 could have directed you to read the T&Cs, but you would already have signed up by then anyway. I guess they assume people read them and understand what they are asking for.
If you are unhappy with how O2 have dealt with you in general, or are unhappy with the initial bill you can cancel within the first 14 days of the contract, though you will be have to pay for any useage you have made. I think (though check with them) you are then just billed a pro-rata'd tariff for the month then any aditional charges you have incured (premium texts, calls outside the inclusive types etc). Keep in mind though that other providers operate the same system (and most don't allow you to cancel within the forst 14 days).
