Troymail's picture reference is valid even though it is referring to Motorola's X2-TDMA and not Phase 2. For most transitions, the system will be migrated from 1 to 2 as subscribers are swapped out. For example, locally we are just now starting the migration to Phase 2 capable infrastructure and at last count still have roughly 15,000 Phase 1 subscribers deployed. Currently we are talking about system absorption/expansion as the system owner is merging a few smaller systems and that'll take place over the next 2.5 years or so. Then they may start talking about Phase 2...
The Phase 2 control channel is the same as a Phase 1 control channel (9600 bps C4FM or CQPSK) to allow backwards compatibility with Phase 1 subscribers. For voice/data in Phase 1, 9600 bps channels are used (9600 bps uplink and downlink). The primary difference is the use of 2 slot TDMA in for voice/data in Phase 2 (12,000 bps downlink, 6,000 bps uplink).
In the system, talk groups can either be FDMA, TDMA or mixed mode (repeaters can also be configured this way). Essentially, if a Phase 1 only radio affiliates (assuming the talk group is allowed for FDMA) then it'll knock all of the subscribers affiliated with that talk group down to FDMA system wide. There are some gateway's capable of performing allowing a talk group to be Phase 1 at sites where Phase 1 subscribers are affiliated and Phase 2 where only Phase 2 subs are affiliated but those aren't in common place right now.