I opened my list in datasheet view. But I wasn't able to edit in that view - things were read only. How do I enable edition in datasheet view?
Make sure you've configured the Datasheet section of Advanced Settings in List Settings. You should be able to edit the list in datasheet view, if the radio button is checked to "Yes" under "Allow items in this list to be edited using the datasheet and you have the correct permissions to modify the list.
In addition to what Kambridge has added you also need to ensure you have correctly installed Office 2007 Data Connectivity Component in the client system. This is used by the Datasheet view.
I had this issue.
Create a new data sheet 'view' and remove all system columns which are read only (created by, modified date, etc.). I only have Name, Desc, and my custom meta columns.