So I changed Client's Vendor Class ID Must Match Name to YES, restarted as it suggested and then only some of my IP phones (mostly the original ones purchased) were able to connect, with the rest stuck in Discovery mode. I even added ipphone.mitel.com to the name, but that didn't help.
At this point, I turned back off the Client ID setting, restarted again and my phones are all connected. Any idea what configuration setting I probably missed on some of these phones?
Thanks.