Add Contacts To CRM From Outlook Not Working

I'm walking an end user through importing contacts into CRM 2011 form Outlook.  I'm not sure why we are seeing different things.  When my contact book is finished being analyzed, I see the following.

Question though - I know what green red and yellow mean, but what about blue?  How come only 8/25 contacts can be added?

The following is what the user sees on his screen (he's at another site using the same cloud based CRM).  Why are the backgrounds of his grey rather than green yellow or red?  And why can only 2/635 contacts be added?  He has a clear CRM account - there are no accounts or contacts existing for him yet - and the same goes for all users in his business unit (contacts and accounts are locked down to BU in our installation).

Can Somebody help me understand:

1. Why the backgrounds to his entries are grey, and most importantly
2. Why he can only add 2 of his contacts?  NOTE that this will create 400 and some accounts for him, but only 2 contacts.

Thanks!