I have been having this problem for AGES!!! Never found a solution. Maybe someone can help.
My iPhone contacts behave like this:
- when i open my contacts, I have this button on top that says GROUPS. - when I click groups and then return to my contacts again -- ALL MY CONTACTS DISAPPEAR. - my contacts are still there because my SMS still have the names, Favorites too. 3rd party contacts apps can display my "missing" contacts with no problem. - to get my contacts back, I have to turn off Contacts syncing of my Mobile Me account then click "Leave Data in iPhone" then turn ON Contacts syncing again. VOILA!! All my contacts reappear. - I tried syncing my contacts to outlook but after every sync outlook is still empty. - I got a Mobile Me trial account and my iPhone contacts does not sync with Mobile Me. My Mobile Me contacts is still empty. - when I add a contact in Mobile Me, it appears on my iPhone - that works. But syncing from iPhone to Mobile Me doesn't work.
it seems like my contacts is invisible to all programs.
I even tried backing up all my contacts in iDriveLite. iDrive backs up my contacts. I restore using "clean slate restore" - after restoring my contacts still behave the same way.