The prob i s- if u don’t have the recycle button on - whilst driving in traffic / city - u get all the fumes and odours coming straight into the car. I personally never turn off the C button - but again depends on where you live and what your driving conditions are;
Good and right answer , not do you only get the fumes, but also the warm air. Try it with the 'C' button and test. If the issue still exists, then take it back to Toyota for a check-up.