In Australia I have cut down several regular sims down to nano size to fit in the iPhone 5 with no issues and have them working in the iPhone 5 (I do it as a free service)
It is important however to note the following:
1. There are 2 types of sim cards, only the newer smaller one is compatible AFAIK, although I have not been willing to risk cutting down the old one (there is a significant difference in contact area size if you wish to tell the difference). If you would like me to identify them for you then email me the pic.
2. If you cut down a sim card and don't do it properly, and on the very unlikely chance that it gets stuck, then apple will not cover it under warranty (its classed as user damage)
If anyone wants a sim card cut, I do it as a free service.
Edit: Don't waste your time with sandpaper, it only makes a mess. Using you fingernail or a razor blade to clean off any burrs is more than enough. YOU DO NOT NEED TO MAKE IT THINNER TO WORK!