Hi Everyone, after a hell of a long wait with Blackberry I got through. The technician at the other end was well worth it. Problem resolved. The problem was attachments with contacts (bogus pictures that were attched to the contact).
Went through all my contacts and deleted the attachments - sync'd like a dream.
Outlook 2007 Beta 2, Desktop Maanger 4.2, BB Pearl/8100 does work
edited: spelling