Don't quite remember that either,

but in any case: it seemed to be interfering with (or not as fast/reliable as) the earlier Contacts syncing I had set up via the Exchange account, long before iCloud even existed.
I do use iCloud for other syncing: it's especially fantastic for syncing PDF files I read and mark up in GoodReader. I also use iCloud for syncing in other apps, such as Scanner Pro. (Soon, I hope, also for syncing the best iOS e-reader software, Marvin, between iPad and iPhone.) I also find iCloud convenient for syncing iOS Notes and Photo Stream.
I
don't use iCloud for syncing Contacts (handled by the Gmail Exchange account), Calendars (handled by Readdle Calendars) or Reminders/Tasks (handled by Toodledo). Neither do I sync Mail via iCloud -- handled by 4 Gmail accounts I have set up on both of my iPads and the iPhone.
To sum up, iCloud is very nice for certain things, but not for everything, so I think it's best to pick & choose those services you'd like to have synced via iCloud -- not necessarily all services.