was doing google searches tonight and came across this
http://www.webgear.co.nz/Products/GOContactSync.aspx
IT WORKS!!!!!!!!!!
ok there are a few bugs in it but i now sync my outlook to google and then google to my phone. it works and transfers the contact picture. it is only beta and it is free!!!! omg im extatic!
make sure you make backups of your contacrs before you try it. google should have a clean slate on the contacts and you need to do some adjusting of fields (pain in the pooper but it works) and then sync your outlook.
if you have troubles look at their release notes and comments. this will be a kick ass application for us that still use non web based email!