A lot of this comes from the pre-installed Verizon contact-backup app.You can't delete it, BUT you can refuse to activate it. That that takes a Factory Data Reset and you must (BEFORE the FDR) go to your online My Verizon account and delete ALL the contacts listed there.
There's a sticky thread in this forum that details how to do a clean Factory Data Reset (title starts "Bingo....") You will need to re-download all your apps from the Market, but it doesn't take long.
Gmail is your primary source for contacts on the X. Life is much more simple if it's the only contact list you use. Also, Gmail will fetch your Pop3 email accounts, so don't have to use the Gmail email address if you don't want to.
Another cause for contact issues: If you have imported your contact list to Gmail from Outlook, you need to go through your Gmail contact list (one at a time) and make sure the names are entered in the correct places ... first, middle, last. Imported contacts from Outlook often come through with the names garbled, such as being all listed in the middle name slot rather than the way it should be.
BTW, in Gmail, you can put the whole name in the "First" slot, which works for business names.
Another warning - I don't use Facebook, but allowing Facebook to access your contacts creates a contact-disaster. So there's another thing to check out.
Took me forever to figure out this issue, which made a total MESS of my contacts. I think this should be a sticky (mods??)