I know I'm not suppose to have any many-to-many relationships. I'm confused... Any help is greatly appreciated!
I'm responding to just this one little part. Other posters can respond to the details of this template's design.
Of course you can have many to many relationships! You just have to know how to set them up. The standard text book approach that works with Filemaker and most other relational databases is to set up a join table that servers as a bridge from one "many" table to the other.
Let's take your contacts and groups relationship for an example. I don't use the contacts template, so my field and table names won't match it, but you should be able to apply the concept.
Your groups table should have a GroupID field, probably an auto-entered serial number. Your contacts table should have a similar but separate ContactID field. To set up a many to many relationship, you create a "join" table with the following fields and relationships:
This sets up the relationships you need for portals, reports and calculations that need this "many to many" relationship.