I spoke with the OEM Marine distributor for Sony electronics when I saw your question. He did some digging and has written me back today to suggest that you probably need to go to iTunes and run an update on your iPhone 4 if yours is not working with the Sony head unit.
I have the M60Ui and an iPhone 4 and it runs fine. However, the RMX60M I have is the same situation as yours, when connected to iPhone it will only show connected. The readout from the radio does not make it to the remote. One needs to use a thumb-drive for the remote to display title and artist data. That portion of your description is normal.
BTW, so you know, you can toggle the CDX-M60Ui from locked to un-locked mode if you want to use the phone to select your music. If I recall you just press and hold the MODE button, and it will unlock the phone. Got a separate note in asking this to verify... It might come in handy for you guys...
Last edited by philwsailz; 03-02-2012 at 10:45 AM.