I'm a little bit confused by some of the points of your post.  You are using
Outlook, and not Outlook Express, right?  Outlook doesn't put a list of
contacts just on the left of the screen.  And in Outlook, the Address Book
is just another view of your Contacts folder, so if you delete a contact
from the folder, it will also disappear from your Address Book.  Why would
you be trying to delete all the contacts in the NY folder, anyway -- do you
really mean you just want to hide them?

I don't know what version of Outlook you have,but you
could create a totally different Contacts List...name it
whatever you want to; thereby giving you two completely
separate Contacts lists.  To do that...if you want
to...just right click on your existing Contacts folder
and click to begin a new one...;  now just generate a new
list.