As Klaus says, the DIM has to have the proper coding in order to "talk" to your car. Apparently the replacement you have doesn't carry the proper code.
Let me offer up a less expensive option. Get the original DIM in your hand and call Southern Vo-vo at 1-888-757-8686. Tell them the year and model of your car. They will ask you to read off certain numbers that are printed on the back of the DIM. Those numbers contain the secret code. If they have a compatible DIM it will cost you far less than a Xemodex rebuild, and they guarantee it to work for a nominal period of time or your money back.
If Southern Vo-vo can't supply one, try Erie Volvo 1-800-441-3743.
I did this with my 2003 V70. It cost me arounf $120 incl shipping and it worked like a charm except that the DIM retained the odometer mileage from the donor car - but who cares?
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