Official Gmail Blog: Four changes to Gmail contactsOn the iPhone you can still only search by name and business, on the original PalmPilot you could search across all fields.
...Search across all contact fields
We've heard you loud and clear, and contact search now works much better: instead of just searching contact names and email addresses, it now includes phone numbers, notes fields, and mailing addresses as well. So, if you're visiting the Bay Area and looking for friends to catch up with, you could try typing '650' or '415' in the contact manager search box...
Google has made several changes to Contacts. In Google Apps you can now enable a "contacts" app that moves Contacts out of Gmail into their own context. Of course there's long been a secret URL to do the same thing.
I'm a bit disappointed Google has never restored the wonderful simplicity of adding email addresses in version 1 of Gmail. I recall you could post lots of addresses into a text field and Gmail would parse them.
Even so, it's good to see Contacts getting attention.