Just continued with this thread. I have Galaxy S2 and it seems that this problem continues. It came with Gingerbread, 2.3.3. and I wonder if this is the issue.
Anyway, not sure if it's the contact list or what but the phone would connect for about 10-30 sec's and then bluetooth would disconnect. Super duper annoying. Galaxy S2 may not out in the US yet and I suppose I won't have anyone complaining about this until then! Argh.
I will try the stopping service method. Maybe it will be a stop-gap until some permanent solution is out.