I've searched and found several posts on various sites with this same problem but nobody offering a solution.
I use my N1 in a car mount with music playing through my stereo with a 3.5 mm cable. When I make or receive a call, I have 2 options. I can either hear the other person through the car speakers clearly, but they can't hear me. The other option is to turn on speakerphone and they can hear me clearly but they are piped through the phone's speaker on the back which is tinny and hard to hear in the car.
The obvious solution seems to be to use the headphone jack as the output for the call audio but with the input treated the same as when speakerphone is on, but I can't find a setting or an app to achieve this.