Ok, I agree with everything else you just said, but how did you get that out of the rules? In order to be in "flanking position" you need to threaten your opponent, which you do not do with a ranged weapon.
And just for my benefit, because I think I actually sorta understand the debate this time, let me set up this situation. Two people are standing on either side of a 3rd person, being in "flanking position." One of the people in flanking position is armed with a longsword (A), the other is unarmed (B) (and doesnt have Improved Unarmed Strike). Person A attacks, but doesnt recieve the flanking bonus because person B is not threatening thier opponent. Person B attacks, and DOES recieve the flanking bonus because person B IS threatening thier opponent. But I would consider both to be Flanking (rules term) thier opponent. After all, you cant Flank all by yourself, so both of you must be Flanking or no one is.
But in an case you cant Flank with a ranged weapon. You can stand in flanking position with a ranged weapon, but you cant Flank without either threatening or attacking.
Thats all assuming no special Feats or class abilities or magic or whatever that allows you to threaten with a ranged weapon.
I hope that made sense.