Quick mail to Icom got this response
Thanks for the E-mail. Yes, we have encountered this problem before and exactly for the reason you describe. If the CH16 revert facility is not required the easiest solution is to cut the wire inside the mic that runs to the hanger 'button'. Simply open the mic up by removing the five screws on the back and cut & tape the lead that runs to the back plate.
Hope this helps
Icom Service Support
I did mail back to ask if this ruined the warrenty but got no reply.... You can also turn off this "feature" by taking it to a dealer, but as mine is firmly mounted in the console its the snip for me!
But if anybody is buying a new Icom - get the dealer to turn this feature off when you buy it