Omniscient First Person

I just finished Kent Haruf's Where You Once Belonged, and I enjoyed it--he's a solid writer. But I found his use of the omniscient first person slightly distracting, at least initially.

Reading any literature involves a leap of faith, of course--perhaps particularly regarding stories written in first person, because who exactly are they talking to, anyway? The reader, of course, but still, it's a total breakdown of the fourth fall--or it would be if there were a fourth wall. But still, is it believable that a first person narrator would know other characters' thoughts and exact words?

With the novel, I decided to believe it, since it was a story about a small town, and many of the characters were gossipy. But with a novella I read recently, there was also an omniscient first person narrator, and this person would describe scenes involving characters he/she (the person was just "I," that's all that was revealed) never met--as well as scenes involving a character who would forget what happened immediately. So I definitely found that distracting--in fact, I considered it a flaw.

I tend to believe that a writer should cast a spell, and if the reader gets distracted and begins seeing wheels turning, the illusion is over. But that isn't always the case. Occasionally when I'm reading something really great, I'll stop and try to figure out how the author did something, and that can be enjoyable as well. I guess it's just a question of whether or not you believe a certain technique works. And I think it's rare that using an omniscient first person narrator is a good idea.