I told my wife about the i'm initiative (a sort of viral charity) that Microsoft introduced recently for Windows Live Messenger. No no, a real one: a good one. No doubt the Gates Foundation's giving ways (or at least example) at work here. So she too thought it was a cool feature that the Live team added and wanted to contribute. As anyone can relate, we too have friends and family members that have had difficulties with certain conditions or ailments and have particular cause(s) that we care about. This i'm initiative to us felt like a good way to lend a hand and spread awareness. Needless to say, it shouldn't substitute contributing real time/money, when it can be done, but a good way to contribute nevertheless.
To the point though, as the title of this post indicates this isn't a commentary on charitable giving.
So after configuring Live Messenger with the cause that touched her, the wife IM'd me asking if I could see her i'm thingy (emoticon) next to her name in my contact list. I didn't, nor could she see mine - hmm(?) 
. Below is an example what you might see in your contact list when not having this problem.
Alas, using my alternate Windows Live ID I could see many other of my contacts with the i'm emoticon that I didn't see using my primary account - argh(?!) 
. I looked through all of the settings/options and couldn't see anything that may be causing this. I was seeing a couple of them on my primary account: why not all of them? Couldn't figure it out so I went to sleep.
A couple of days later I had a need to log into my alternate Live ID again and figured it out! It turns out that when I add contacts to Live Messenger I always give the contact a nickname. Ya, I’m a control freak and I don’t want Messenger to choose one for me. Turns out this is why i'm information wasn’t showing up too. Makes sense: by adding a nickname you're telling Messenger you don’t want to see your contacts display name, the one they setup. Case in point, Bennie likes to be called !@#$% 
- kidding, kidding.
I've now gone through and removed all my contacts nicknames - the ones I entered. It turns out that it is important to me what my contacts are communicating through their display name. The field, after all, does say “Type your name as you want others to see it.”
Anyway, hope this helps.
Postscript
I notice that "some" of my contacts (stop it!) have their i'm tag in front of their name instead of after. This, of course, is driving me nuts as I want my contacts sorted properly. Also, since I'm trying to avoid applying my own nicknames I've noticed that a number of my messenger contacts have not yet applied a display name or have made it something like their email address - DOH(!) 
. Likely why I started doing this in the first place. My OCD is kicking in right now and I almost can't finish my sentence. I need a crack to step over or a wall to tap! Calgon, ... !