From Eugene Senyszyn:
Do you or your friends have avatars on the Xbox 360? Now you can download them and import the avatar pictures into your contacts. Have their avatar or personalized avatar face pic come up each time they call!
You don't even need to have an XBox or a live account, just know some the gamertags of your friends!
An internet connection (edge/3G/WiFi) is required to download the images.
After importing, go in and edit the contact picture and then re-save (no need to move it around) to have it appear full screen when a call comes in!