What I found was:
Bad - Internal Mic, no external mic connected
Bad - External mic connected
GOOD! - Internal Mic with just the external mic extension connected
What a great relief! In my car, I have the GPS antenna sitting on top of the headunit (was too lazy to run the cable and mount "properly") and it works great. Now I also am using the internal Mic with excellent sound quality with just a small extension installed and nothing connected. I was not expecting such an easy time.
I still have the problem with bad A2DP sound quality. I haven't investigated this yet. I also have a weird problem where turning the volume know to the left will sometimes start making the sound louder. Luckily it fixes itself after a reboot and I can also volume down with the steering wheel controls.