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Well my manual is the same, and i guessyou call "pressing the phone button displays a no phone" as clear?Thanks for the input that really clears it up, seems I'm not the only idiot that can't figure it out.
If you did not get the optional hands free system installed in your car then its just there to mute the radio. If you did get the hands free system installed then it works like any other bluetooth system.
Go to WWW.FORDACCESSORIESSTORE.COM under 2008Mustang accessories I think its called "Mobile-Ease" Hands Free System Advanced. PT#7L2Z-19G399-A for $411.71, OUCH!!! This will probably work with the phone button,I think. Sounds good atleast.