Ignition to the first position, turn on bluetooth on the phone, enter passkey, turn ignition off, wait about 30 secs. Then turn start the X to make sure they connect.
Here's an article from the main page:
http://www.xoutpost.com/showarticle-16.html

press the button on the cradle before turning the car on and then hold for 2-3 seconds until BLUETOOTH pairing shows on the NAV or the three little lights start to flash on the NAV/OBC... then do the above!

Please let me know if you are able to transfer your phone book over to your X5 using your V3c... Verizon claims that they have disabled OBEX on their Blue Tooth profile but apparently there was a mistake made on the first few thousand where it is enabled (right up until you update your phone and then Verizon disables it)... I was about to buy one but it seemed like it would be a hassle so I went with the Samsung Blade (should have it by Thursday).

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Current Cars:

2008 X5 4.8i - Blk/Saddle
2001 330Ci - Titanium/Black Sport/Premium

Past Cars:
1993 325is Blk/Blk Sport
1995 M3 Blk/Blk
1997 328iC Blk/Blk Sport/Premium
1998 M3 Silver/Black
2001 M5 /Black/Black/Sport
2005 X5 3.0i - Blk/Blk Sport/Premium

Verizon's V3c pairs fine with the X5 and the phonebook transfers as well. OBEX is enabled.