Here is the info I received back from Hotmail support:

We traced the issue back to a security-related change on the Hotmail
servers, which unfortunately affects all Hotmail customers and is too
critical to revert.

Entourage X users who do not upgrade to Entourage 2004 can try the following
workarounds:
Receiving Mail: Move any messages in the Outbox to Drafts. Message retrieval
works in some cases if no messages need to be sent.
Sending Mail: Send messages via a non-Hotmail account.

Sorry I don't have better news.

-- 
Diane Ross, Microsoft Mac MVP
Entourage Help Page
<http://www.entourage.mvps.org/>
One of the top five MS Entourage resources listed on the Entourage Blog.
<http://blogs.msdn.com/entourage/>


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