Q: My iPhone Bluetooth connection cannot be seen by other phones  and other phones cannot see my bluetooth when switched on

The supported bluetooth profiles on an iPhone are limited. Mostly it is for headphones, automotive connection, and hotspot. I can't think of a supported profile that involves another phone -- and that would explain why it is not seen by other phones. Following is a link to supported profiles: http://support.apple.com/kb/HT3647

And they will not see other phones. The Bluetooth profile on the iPhone has never supported connecting to other phones for transferring data, etc. See the link that FoxFifth provided and see what Bluetooth profiles you can use on the phone.