IPhone is with 100% Reproducibility Interfering with Magic Mouse & Bluetooth

My Magic Mouse would start acting up @random - Sometimes days would pass with no problems other days I would have the problems all the time...
Last week I wanted to find the culprit. And I have !!!
It is the iPhone.
I made a list and took notes of what I was doing every time the issue occurred.
The console would should no sign of anything.
the past week - My girlfriend had been using my iPhone to listen to music in a separate room. This week, I bought her a stereo ;-)
The past week I had ZERO trouble - this week nothing but trouble.
Going thru' my list, I noted that only the iPhone was the missing link.
So as the iphone was sitting next to me and the problem occurred I did this
Turned off its Bluetooth...     == No Change     (Lag & weirdness)
Turned off its WIFI               == No Change     (Lag & weirdness)   
Put it into Airplane Mode     == Change          (No Lag No weirdness)        
Put it back into Std Mode     == Change          (Lag & weirdness)
Moved iPhone to kitchen     == Change          (No Lag No weirdness)
I can do this all the time and repeat the problem 100% of the time
The iPhone is most definitely interfering with the stability of the Magic Mouse... NOT with the Trackpad !!!!!!!
Both using BlueTooth
But the again, we all know in 2014 that the only magic about the magic mouse is its ability to produce magic results,
NOT invoked by the user and cause Wrist Pain. But hey, it looks really cool ;-)
Hope this helps anyone with this problem,
I tested this with my iPhone 4s running iOS 7 --- So I don't know whether this applies to other models and OSs

I have this same type of problem. As long as wifi is off bluetooth works. Turn wifi on and bluetooth can no longer find anything—no phones, computers, speakers, mouse etc... Bluetooth worked perfect rooms apart before Mavericks. I called Apple and they think it's a hardware issue with the mini. It's funny for something to be working so well before the software update. I told them to put the case on hold and I will wait for the OS update. If the OS update doesn't come I suppose I will drive the hour or so to the nearest Apple repair shop and have them look at it. The main reason I'm posting is I see very little about this issue being discussed. I hope to see some replies. Thanks.
Mid 2011 Mac Mini.

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