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It is not a Tesco thing but an O2 rule. If you go on the O2 customer forum, there are loads of "my sims not working", when tasked over its use most reply "it was working fine in the router yesterday"The difference appears to be that some are saying that Tesco mobile sims won't let you use the sim in a home broadband (ie mains) router but will in a genuinely mobile MIFI router (battery operated as well and via a cable).
As I've not had a Tesco mobile sim I've never tried it in a MIFI nor home router so can't say if this is definitely the case of not but I'm just trying to get others to clarify exactly what they are using when stating they DO work in a router, ie what type of router.