Vonage's 911 system does work. What your are doing is allowing them to register your number with the location it is at - so 911 goes through correctly.
See, with Vonage, your "local" number can be anywhere in the country - so you have to tell them where the number is based out of.
I have it, love it (especially the online convenience), and wouldn't go back. We take advantage off all of their services, too. For example, when we go to our vacation home, one click routes all of the calls to that number, or we can change the greeting for a certain number of days (to tell folks we are away), etc. For 5 bucks a month, my grandmother now has a local number (for her) to call, yet the calls come to me - and she doesn't have to worry about paying for the call.