all my really old nokias and ericsson and motorolas (that did have Q and Z :) did not made uppercase... pressing one key over and over would cycle the lower case chars only.
Hence, the remote end must assume the "2" to represent either an "A", "B", or "C". What I'm saying is that it's reasonable to further assume that, if the user pressed "2", they may have pressed it to indicate one of the three corresponding lowercase characters. Humans generally ignore case.
What's not reasonable is to assume that a human, faced with a DTMF pad without a Q or a Z, would press anything. Sure, you could interpret all digits as a possible "Q" or "Z", but it's equally likely that a human in such a situation would leave the character out, or give up and call tech support. It's simpler to just disallow these characters.
But you're making the mistake of assuming they're hashing passwords at all ;)
That, I think, is the correct inference.
If the system shows a misunderstanding of security or makes it clear that shortcuts were taken, then what is to make you think the same didn't occur on a deeper and more important level (databases, security, etc).
this is incompetent developers in a dysfunctional environment. there is no good light anyone can throw at it. and no, having the system live since the 50s is not a good excuse. it is certainly not the same system, for obvious reason.