hmm..ok..played some more.. Tried putting the HT502 in the DMZ of my router. didn't make a difference..

I did find out something interesting though..

If I answer the phone connected to the HT502 on the first ring, then it works fine.

If I answer the phone connected to the HT502 on the 2nd ring or later, then I get the busy signal on the HT502 connected phone when I answer. puzzling..