Genius swapped with new phone
Went to my Genius appointment. Was an hour early because of light traffic. Even though they were pretty busy they helped me out within 15 minutes of my arrival instead making me wait for my appointment time. You can ding Apple for some things, but you won't get service this good with any other vendor. When I reported the problem using Apple's online support and requested they call me back I no sooner hit the OK button on the screen when my phone rang. I was completely done and had my Genius appointment confirmed in less then 10 minutes.
At the Apple store the CSR took one look at the gray lines and swapped out the phone with no delay. He activated it and I checked for the dreaded yellow spots, swapped volume buttons and any sign of lines. All checked OK.
BTW, the new phone also has the loss of signal indication issue. My original iP4 had it, though it was difficult to duplicate repeatedly. Tried it out on the new phone before I left the store and when the death grip was applied the bars dropped. However I did it while in the middle of a call and the call did not drop. In fact I could not get a call to drop with my original phone with the death grip.
Also no problem noted as far as the proximity sensor in either my original iP4 or the new one.