Your windows may have incorrectly cached information, which for some reason Outlook 2007 likes to hang on to. Check your saved passwords in the User Accounts area:
1. Open the Control Panel.
2. Click on User Accounts.
3. On the left-hand side, click Manage your credentials.
4. You'll see a list of Windows Credentials and Generic Credentials. Remove any and all that appear associated with your email address or provider.
Hope this helps.
-SW
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