It's possible to send individual contacts via Bluetooth with Contact -> Send Contact -> Send contact - Bluetooth.
But I don't see a way of doing this (on the HTC Desire) with a group of contacts?
Is this possible?
Yes it is possible. You have to install one application from market. There is an option to send all contacts via Bluetooth or Email. But I don't see any option to send a group of contacts in Android system.
There is an application called Go Contacts with which we can group the contacts and send it via Email,SMS or Bluetooth. Its a free application available on Android market.