Muppo:
Using A0 to control the contrast is something I have used many times and have no problems with, so saying it won't work is, I'm sorry to say so, just plain wrong.
So you are claiming that you can adjust the contrast using the A0 pin and analogWrite() ?
What Arduino board have you done this with?
None of the Arduino boards I've seen support PWM on the A0 pin.
(Which is what Delta_G has been saying as well)
--- bill