[dlink72]

Problem finally solved!! =D>

For what it's worth, this is what I did.
1. Deleted relationship between activesync and phone.
2. Uninstalled Office 2007 and activesync, then deleted all remaining program files of both.
3. Rebooted PC and soft reset on phone
4. Defraged PC
5. Rebooted PC
6. Installed Office 2007
7. Rebooted PC and ran outlook.
8. Installed activesync 4.5
9. Rebooted PC and synced the phone with contacts finally synced.

Very frustrating considering I uninstalled and reinstalled everything several times. The only difference was the steps I took in the process. Either way, I hope this helps someone else eventually.