I think Google has lost sight of something very simple in this fracas:
With Google Contacts, the user directly manages his contacts' email addresses.
With Facebook, the user delegates management of email address to his contacts.
These are not the same thing. The Google contacts team seems to think that Facebook is an address book just like them. They are not. And to me, that failure to understand the differences is the root source of all this tomfoolery.
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Edit after some very welcome discussion downstream:
On GMail, my contacts' email addresses are MY data.
On Facebook, my contacts' email addresses are NOT my data. The FACT that I am connected to my contacts is my data, but any information about those contacts does not belong to me.
This is why Facebook is not an address book, and pretending it as an address book where "your data gets stuck" is bound to lead to frustration for everyone.