Okay, I've had this same problem, and figured out the solution. I don't know if you'll ever see this again, but in hopes that someone googles this problem, here's what the problem was, at least with me - someone added me to a Windows Live group (I don't remember if I accepted an invitation or whether I received it at all) - after that, I was getting notifications for all the people from that group, whenever someone logged into Windows Live, even though they weren't my friend, and when I tried to click on the window, it gave the same error.
How I left the group - in the search bar in the contacts list, I searched for "a", "b", "c", etc. until the group was shown in the search results (it appears on the bottom of the results). Then right click, block group, and leave group. Also, all the members of the group were shown in the results when I searched through the search bar, but they were never displayed (and neither did the group) normally.
Hope you read this, I'll befriend you in hopes you'll get an email from this forum. Cheers!