To be honest I have never answered it folded all the way so it is in single screen mode, but I have answered it folded flat and then folded into single screen and that has the same outcome.
I have never really noticed whether the mute button is lite up or not.
It seems to me that the screen is still touch sensitive and maybe I am touching something with my ear or brushing against my face it also auto rotates I don't know if that is having an effect on the call