As strange as it may sound, the DJI Cables have a specific orientation. Note the little image of the controller on the cable end. Might not be the issue since I use aftermarket USB C-C cable both with an iPhone 16 PRO MAX and with an iPad ProM4 with no problem.
PS After writing this I did start the Mini 2 up, worked fine with iPhone 16 Pro Max, then reversed the cable shown below, and restarted the Drone and DJI Fly, still worked perfectly.
Unfortunately I have this issue with an iPhone 16 pro and a mavic air. Using the DJI USB C to micro USB adapter and a USB C to USB c apple cable. The phone does not recognize the controller or vice versa.
Ordered a micro USB to USB C cable that is coming tomorrow and will see if that works.
Happy to share that using a USB C to Standard USB interface the phone is able to connect to the controller and drone. Note, I'm using the big USB port in the center of the controller and not the micro USB port on the side. The Micro-USB to USB C connection did not work.