Also, Google didn't give that as the reason for the app being classified as spyware. So it's just the OP being contrarian by taking an optional feature, claiming it shares contact details when it in fact doesn't and everyone voting it up because it sounds reasonable.
Of course, if I were the dev, I'd eventually try and go through anything that touches contact and disables that to try and see if that solves the problem, but again that shows that Google doesn't communicate at all.
It seems that there is firstly no reason or clarification given. Then, it seems the process of reviewing an update can happen out of phase or sync.
That means there's a very weak "compliance oracle" to see if you've correctly identified the right issue or not. And with high latency, likely it will be difficult to find the right issue quickly.
Disabling everything isn't really a good solution in the longer term as a developer - Google needs to learn to communicate with developers via intelligent humans that actually understand what they're doing, and can have a discussion and help get the issue addressed.
Google just has a demented communication policy.
I think almost everyone would be agreement that Google can communicate better.