They did indeed disable it for new non-premium accounts under OE and other clients, but Windows Live! mail now supports Hotmail flawlessly.
I'm using Live! and in many ways it's a great improvement. For most home users, it's actually better than the full version of Outlook. My only problem with it is the way it manages files. Every email is a separate file, which means if you have more than 10,000 emails it takes about 30 seconds of drive-thrashing to open. It's all roses once it's open though, and it minimises to the task tray which OE never did. The calendar and contacts integration is especially great if you're an MSN user.
If you only have a few hundred emails then it's absolutely fine, and even if you have millions then at least they don't get corrupted. I imagine the corruption-proof nature of the new system is why they implemented it.
However, I don't think Live! is available for Macs??!
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