Current problem solved!
Okay, here is my solution to this that works really well for me. Here is what I want:
Full field labels from iCloud. (usually Google changes email fields to Other)
Full res pics for incoming calls.
If Google Contacts offered these then I wouldn't bother with iCloud.
So what I did was:
Import my Google contacts into iCloud. (see previous post in this thread).
I already had Google Exchange set up and running.
Turn on iCloud Contacts on iPhone.
iOS5 automatically links exact names without showing them as duplicates.
Under All Contacts do any editing you want (set pic, label fields, etc.)
That will update both iCloud AND Google.
iOS5 is smart enough to use iCloud Contact info first so you get all the benefit of iCloud but any updates also get pushed to Google Contacts.
I've been using it for the last few hours and so no drawbacks.
I think this will work for the majority out there that have been sealing with this issue.
The above alost worked but was missing one step. I have solved it! I want the same things mentioned above, the main thing I was missing was full resolution pictures for calls made and received.
I started with a clean export of Google contacts, cleaned off my Iphone 4S through Itunes, cleaned off all contacts from the Mac Address book then began.
First synced Iphone via the exchange method, now I have a synced IPhone and google contacts list
I make sure that the phone and the mac do not sync address or calendars through Itunes. This solution does not use Itunes for anything.
I then turn on Icloud and have it sync with my Mac Address book
There is still nothing in either at this point.
Then I open address book on my Mac and double click the VCard format I exported from google contacts. (This is found at the Contacts Settings page at Google, I exported every type just to be sure). I now have a Mac address book and ICloud syncing perfectly, but it still does not know anything about my Iphone
I then turn on Icloud as mentioned above, on my Iphone 4. Now on my Iphone Under Groups I have All Contacts, Exchange/Contacts and iCloud/All ICloud
Now I go to Settings, Mail Contacts and Calendars, scroll down to the Contacts option and under Default account I click to iCloud.
Just did this, but now when I take a picture for a contact it syncs instantly via the cloud to google contacts, icloud and my mac address book and shows up when that contact calls me, at least it has for a few minutes, after 5 minutes, I have found it no longer shows the full picture when I call them.