I use the iphone all the time without a case. It's just a bloody phone. Not the crown jewels. You can't take it with you ....

There have being issues with the cradles. Plugin will not work with just the USB cable. Plugin uses analog video and audio and not passed over USB, and require the cradle. This is documented in the BMW blurb.

The fact your phone doesn't work when snapped into the cradle suggests there are issues. You may have a faulty combox. There appears to be many issues with them. Take it back to the stealer.