Number two in chinese: 二 vs 两 I always knew, from my studies of Japanese, that the number two is 二 (èr). I am not sure about the actual etymology, but looking at the character, it's understandable why it represents the number "2".

Recently, I discovered that there is another character that represents the same number. That character is 两 (liăng).

According to my textbook:


二 is used when telling or writing a "meaningless" number, such as a telephone number, a zip code, etc;
两 is used together with nouns, such as in "two students" = 两个学生.


Is this correct in current Mandarin? If so, does this mean that 二个学生 is just plain wrong or that Chinese people would give me a weird look if I said it?

Are there other situations in which the use differs or is it interchangeable? I found a site, nciku.com, where there are notes about it, but it says what I already know more or less, so I am asking if there is something else. 

Lastly, what's the etymology, if available, for 两?
Rather than saying that 两 is used with nouns, I would say that 两 is used with measure words. If you use any type of measure word with the number 2, use 两. For convenience, I've identified 3 types of measure words:


Standard measure words, e.g. 两个人、两本书、两棵树.
Numbers that are larger than 100, e.g. 两百, 两千三百六十二. 百, 千, and 万 can be seen as a sort of measure word. 
Time, e.g. 下午两点. Again, 点 functions as a type of measure word here.  


二 is used when counting without measure words, such as in telephone numbers, metro lines (二线), addresses, etc. 


ordinal, e.g. 第二个, 二哥. when you want to say the second, you can only use 二, it is wrong to say that 第两个.