Newbie with a climate control question

[Jack335i]

Hello all. I bought my first Bimmer (Blue 2007 335i) 60 days ago and have never enjoyed a car more. The driving experience is fantastic. I do have a minor glich with the climate control system and was hoping one of you could help me.
The "recirculating" mode is always on whenever the A/C is on. By my reading of the owners manual I should be able to ventilate with outside air and air condition at the same time, but the outside air damper will only respond when the A/C is off. I took off the microfilter housing and watched the damper operate. The car does not have navigation or idrive so I am just dealing with the buttons. Is there a "setup" ("push this button twice, hold in the clutch, flip switch 7 and scream like a howler monkee to set the ventilation.") that I am missing, or is this how its supposed to work?

Thank you all in advance.

[ElRedOne]

If by "on" you mean the light is on by the "A", the system is in Auto mode, which is normal.

[Jack335i]

When I said the recirculation mode was "on", I meant that the outside air damper was closed (confirmed by visual inspection). It doesn't matter whether the light by the "A" is on, the recirculation light is on, or both are off. As long as the AC light is on the damper is closed. It only opens when the AC is off.