Finally I figured it out...
What is this all about? The screen calibration process aligns the internal circuits with the touch sensitive screen, so the unit can detect the task/command you want to perform when you tap an element (control box, letter, arrow, map location, etc.) on the screen. If this alignment is off, you will have hard time using the touch screen. You may have to aim a bit below, above, left or right the element you want to activate by touching it. IF YOU ARE SATISFIED WITH YOUR SCREEN ALIGNMENT ACCURACY, DO NOT CHANGE YOUR SETTINGS.
To test your current calibration accuracy, point just inside the perimeter of a few letters of the alphabet in address entry mode, by using your PDA stylus. If the system precisely recognizes your aimed letter, it means your current alignment is OK, don't change it. If this is not the case, read the following.
DISCLAIMER: The following procedure worked perfectly for me, however, use it at your own risk.
Required tool: PDA Stylus (or similar touch sensitive LCD pointing device)
Step 1. Turn the ignition switch to ACC position.
Step 2. Turn the Audio Power ON.
Step 3. With the Audio Power ON, press the POWER button and at the same time press the AUDIO button for about 2 sec, until the Failure Analysis screen pops up.
Step 4. Type in code 84. ("CDCU Panel Setting" function will be selected).
Step 5. Hit ENTER
Step 6. The digitizer calibration screen appears. Rest your hand outside the touch sensitive area, and tap the dead center of the displayed hair-cross symbols using the PDA stylus. Five of them will be displayed, four close to the corners, one in the centre of the screen. Once done, either OK, or NG will show, acknowledge accordingly.
(Note: I had to repeat Step 6 a couple of times until I reached pixel-fine accuracy).
Step 7. To exit the Failure Analysis mode, turn the ignition switch off.
Step 8. Test the achieved calibration accuracy, by pointing just inside the perimeter of a few letters of the alphabet in address entry mode, by using the PDA stylus.
Step 9. Enjoy!
Good luck!