Good question. The address book is using a book paradigm, and I think the reason there is some usability problems with it is two-fold.
The first is that the metaphor/paradigm is an obvious one but one that does not work very well in practice (I've played with the wallet metaphor when it comes to mobile banking and it doesn't work for the same reasons).
The second is it doesn't follow the other design conventions of the iPad. When you go to the landscape mode in most other apps you get a list bar on the let and content/functional area on the right. The address book doesn't do that. Everyone has been "trained" to do things a certain way and then Apple themselves break their own convention.
Though, let's be honest: I know from personal experience that contacts/address book is the LAST functionality companies focus design efforts on. It's just not a priority or a differentiating feature that makes customers go "OOH! I gotta buy that! Look at that contact list screen!"