Another question that came up at the last tourney: If a massive figure (rancor) is standing on blocking terrain and is next to a figure not on blocking terrain (but all the border they share is a solid red line), are they considered adjacent for purposes of card effects like grisly contest?

This was on ISB headquarters, near the terminal near the red deployment zone in that four way intersection with the one square of blocking terrain. I had a small figure next to the blocking terrain and my opponent brought his rancor down the cooridor. He tried to stop with the leading edge on top of the blocking terrain (covering 2 of the 4 spaces in the intersection) and play grisly contest. We ruled they were not adjacent.

Figures can be adjacent to figures and objects on blocking terrain for melee attacks. Because line of sight and counting spaces to a figure or object are possible for any ability (and adjacency has been previously confirmed to mean distance 1), it would make sense for adjacency between figures to apply to other abilities than attacks too, but it is not absolutely clear by the rules and there is currently no existing ruling from FFG.

I thus advocate yes. See the below thread for why, more details and associated interpretations, whenever directly from the rules confirmed by the designers, but those and the rest not publicly ruled yet.

Note that edges of blocking terrain spaces are not blocking terrain edges. Blocking terrain edges always block adjacency, line of sight and counting spaces, because a figure or object cannot be occupying blocking terrain edges.

When figures that are allowed to occupy blocking terrain (Mobile, Massive) do so, they slightly alter how targeting with blocking terrain works.

If the ability you are trying to use refers to targeting the space it doesn't work.

If the ability you are trying to use refers to targeting a figure, it does work.

Grisly Contest refers to targeting a figure, which is allowed.