From what you've said, hosted would make the most sense.
Ask the client why he wants exchange. GMail for domains is free and really good as well.
Joe User wrote:
Hello, I have a new client who's business I need and want. He's been talking about Exchange and I don't know jack about it. The thing is, he wants it for 2 maybe 3 people. For something that small - wouldn't hosted exchange services be better and cheaper? Anyone?
