Well, I had a call from Gary Smith who is the inventor of this device - the call itself was a nice touch, good to see people standing up and defending their products.
I also mentioned this thread in my original email to them so he may be monitoring for replies - hopefully he'll agree this update truthfully represents our conversation.
Gary confirmed that there is some kind of white mechanical arm which gets in the way on the nav model in the Z4 (having checked one his friend owns) - but not on the other models. He went to great lengths to re-iterate that the device is not suitable for 'nav' units - I don't fully understand how this could be the case, seeing as it's just a plain old CD mechanism in my head unit, the sat nav disc as I'm sure you're aware lives in a separate DVD drive in the center storage area.
He also stated that the fact that it is not compatible with Nav units is very clear, both on the website and the packaging. I've re-traced my steps on the website, both on the link I posted at the beginning of this thread but also going to the main landing page https://www.cdslotmount.com and this simply is not the case - there is no mention of nav units anywhere in a normal "I want to buy something" route through to purchase. There is the following paragraph in the FAQ section:
"Can I use it in a Multi-disc CD Player?
No. Multi-disc & autochanger CD Players DVD or navigation player are not compatible. Please do not attempt use of the CD Slot Mount in any player other than a standard in-car single disc type. "
Again - I did not use it in the DVD player for the Nav, but in the CD slot in the head unit.
I can't comment on whether the packaging makes this obvious as I chucked it in the bin prior to realising I'd want to look at it again

but I suspect any warning I would find is worded similarly to the above - mentioning nav DVD drives only.
Personally, I think this is clearly an issue that has been run into before and there should be an obvious warning front and centre on the product page advising caution to be used - and now they're aware E85 Nav equipped Z4s are 100% NOT compatible, I wonder if there will be a message to that effect
I've sent it back and true to their word, I have received a refund for the full original purchase amount including postage PLUS the £4 it cost me to send back to them. Gary also said they are awaiting the patent on a new design which does not use the CD slot, and that he would send one out FOC when it becomes available - will be interesting to see if that arrives.
Ultimately, I bought it and stuck it in my head unit and broke it - so it's my fault, and I'm not trying to bash a product that obviously works for other models and has achieved great success. Just leaves a bad taste though.