Keep in mind that the update I referenced is not specifically Verizon- or Palm-related. All OS updates for Windows Mobile devices have to be tested for compatibility and distributed by the handset provider, this is Microsoft policy. In the PC world, this would be similar to Microsoft getting rid of the Windows Update site and pushing all patches and updates through Dell/Gateway/HP/etc.

Palm's site does not say what fixes are included in this update, so I have no idea if it will fix the problem, but it is entirely possible that it includes a new Bluetooth stack. I've got a Toshiba laptop with an integrated Bluetooth chip, and the Bluetooth stack has seen 3 revisions since I've owned the machine. Going from v2 to v3 was a night-and-day difference.

The thing is, there are multiple companies out there writing Bluetooth software. There have been many scenarios in which one company's BT stack doesn't play so nice with another company's BT stack. Updated software often addresses these incompatibilities. Again, I don't know if the Palm update includes any modification to the BT software, but it can't hurt to try it. Obviously you can't alter the A3's BT capabilities, and it is highly unlikely that you are going to be able to alter Palm's BT software on your own, so waiting for a new revision to come down in an update is pretty much the only option.

It is still worth checking to see if some other software on your phone is hijacking your BT connection, but until you find a solution you should keep all possibilities on the table.

 

Fix listed above seems to have restored functionality between the Treo 700WX and Bluetooth capabilities of the car. There have been isolated situations where the "handshake" is lost, but reliability is vastly improved.
If one owns this device, it is highly recommended to make this change. The one-button capability for speakerphone and mute is worth it alone. If it ultimately resolves Bluetooth issues, it is absolutely worth the effort.
Additional updates to follow as I keep an eye on the performance.

 

Completely agree!! My Blackberry works PERFECTLY!!

I never loose connection... I can choose which group of my contacts hit the bluetooth so I don't scroll through all my business contacts that are normally in outlook and can just have my friends/family in the steering wheel selection.

My only problem is I wish the volume went above 11...

 

Blackberry is a far superior converged device for businesspeople. Palm Treo is essentially a toy for high school students.
People in my company went insane when we learned we were going to standardize on the P.O.S. and unreliable 700WX.
I'm just glad that it seems to be somewhat working with my Audi again.

 

It appears that reliable connectivity between Audi A3 and Treo 700WX has NOT been established.
The annoying thing is I went from an ineffective 700W to an even worse 700WX. At least with my old device it would interface with the car.
Back to the drawing board...