Apparently the Contacts/Friends things has two different parts! There is the "Friends" part so you can have a list of all your forum friends, and set some of your settings to only allow those forum friends to see/read. (Like your blog or visitor messages)
And Contacts works the exact same way. o___o
So I am assuming Contacts would be people you want easy access to be able to contact or give view permissions to, but you don't wanna list them as friends. (Like staff members, or roleplay partners)