I have just installed lion and iCloud seems to be working well with iCal between my iPhone and Macbook Pro. address book however is not. Firstly I had to spend a lot of time deleting duplicates. The find duplicate function was not doing the trick. After having made some edits, these edits are not making there way to iCloud and therefore obviously to my iPhone. I have noticed that there are two groups on my phone i.e. iCloud and iPhone. I don't know whether this sheds any light in the matter.