I bought the genuine BMW one from Amazon and still have the problem. I read up a little on this and found some other cars/phones have the same problem recognizing the auxiliary setting even sometimes with a straight cable connection to the phone - one of the suggested solutions was to add an in-line volume control between the input and device (bluetooth adapter) to add some impedance.

I ordered this one for $6 on Amazon: http://www.amazon.com/gp/product/B00...ilpage_o01_s00

Should get it tomorrow. I'll let you know if it works.