No Micro SD Card Inserted but phone detects it
That SDCARD is technically your internal storage mounted at /sdcard or /mnt/sdcard or even /storage/sdcard0. They aren't your external sdcard you can insert. That would be mounted to /external-sd/ or similar. The option is greyed out because there is no external sdcard to be mounted. So keep in mind that  there is a difference between sdcard (internal) and external sdcard. Just so you know: With the update to android 4.0 the internal and external sdcards have become a thing.