The mute switch with the red dot on it actually sits on top of another switch which is located on the headphone jack assembly (this part comes built into the assembly), the mute switch simply toggles this switch. Essentially it's a piece of plastic with no other gadgetry attached/built into it. If the mute switch has 'fallen off', I imagine that it's cracked/broken off because there's no way it can fit through the whole in the casing if it was still in one piece. A replacement is v cheap, but the fitting of it isn't that easy, if you following the headphone jack assembly guide on this site it should sort you out (patience required).

Quote from Szabo David:

Oh great, thank you! Don't you know whether it fits the iphone 3GS? Are these parts same for iphone 3G and 3GS, I cannot find on ebay one for iphone 3gs.

David

iPhone 3GS Complete Dock Charge Port Connector Assembly...

http://cgi.ebay.co.uk/iPhone-3GS-Complet...

This is a great guide in helping you dismantle the phone and to remove the existing assembly, however the bit that's actually difficult is not covered, which is installing the new one...when a get a few more minutes I'll write a detailed description of how I did this is and the things to watch out for (it took me bloody ages). Any questions in the meantime feel free to message me!

Quote from Szabo David:

I broke my speaker and the mic. Don't you have further steps how to disassemble the dock connector from the speaker and mic? Thank you

Hi David, you can buy the part as one, I bought the following... http://cgi.ebay.co.uk/ws/eBayISAPI.dll?V...

I found that the tab I needed to flip up was black not white. There is a white piece of plastic that the ribbon slides under but it's the black piece of plastic it slid into that I needed to lift up. I found it quite tricky re-assembly this part, I thought I needed to slide the ribbon in further when in actual fact it was already in far enough.