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I think it's a condition you agree to in order to get your overdraft set up. You also are asked if you have an existing student overdraft - and i'm told by someone who worked for HSBC that they do actually check, although i'd imagine it must be pretty sloppy.
WTF? Where'd you hear that? Natwest are giving away a railcard, & the other freebie is a webcam (but you have to apply online to get that & I went into my branch to do it - wouldn't say no if they decided to give me one anyway though). No iPods. I know that for sure cos that's the one I applied to (partially because of the railcard - I'm moving to an out-of-the-way uni, & I love to travel, so it'll be extremely handy), but also because the account specs sounded like the best deal (I'll admit I didn't spend too much time perusing the others though) & because my regular bank account is with them so it saves having to deal with different banks.