NoRooms Listmanager works perfectly. It does delete/add/manipulate/whatever the various lists perfectly. The reason why your msn messenger can't be logged in is because in order to manipulate your lists you need to be signed in, and since NoRoom Listmanager is the thing that manipulates your lists, it needs to be signed in instead of your msn messenger.
Also, you contacts can only be fully deleted if they also have deleted you on their list. Otherwise they will stay in your allow list.
Nothing can change all that because this is the way msn messenger and the msn messenger protocol works.
In order to write your own listmanager you need to know the msn messenger protocol inside-out and this is far from easy if you're not experienced in programming.