How are they tracking unique activations? IMEI numbers seems the most likely possibility to me, but I wouldn't think Google would keep a list of all the numbers on their servers.

IMEI most likely. They can transmit the number as a non-reversible hash (MD5 or similar), that way the number never gets sent or stored as plain text.

The graph of daily activations is pretty amazing. Based on current growth rates, they should pass 1 million daily activations some time in 2012.