Things work differently on the D2 in regards to Facebook sync.
The change they made to the D2 in the Facebook area mean that the Facebook app on the market is not necessary to sync Facebook contacts/pics to your Droid contacts, etc.
That's the good news...
The "bad news" depending on how you feel about it, is that you don't get the choice, which was available on the D1 w/the FB app from the Market, to sync no FB contacts, only those on your phone already, or all of them on FB.
Set up your Facebook account on the phone by going to Settings>Accounts and selecting the Facebook icon...if you have two icons, I believe the smaller one is from the Facebook app from the market, and the larger one is the built-in FB client. Once you log into the built-in FB client on the D2, all of your FB contacts will be sync'd to your contacts on the D2, and will also be set as the picture source for contacts.
You can actually uninstall the FB app from the market, you don't need it at all if you don't want to use some particular feature of it.