Hi Jackie Gragnola,
I could be wrong but that doesn't sound like proper behaviour to me, there is no need for the lead to come back as a contact and then merge. There is a field in Marketo called "SFDC Type" which has three states, Lead, Contact or Empty (empty if its not in Salesforce). If it was a lead and became a contact the only real thing that needs to happen is for that field to update.
Without being in your system its hard to have more input.