Thanks for the link. I visited the page and followed the instructions as best as possible but they do not seem to specifically tie to Outlook '07.

Possibly someone here can find where I've gone wrong. Here's what I've done:

Step 1: checked 'on this machine only' and 'from people or distribution list'
Step 2: apply rule after arriving from 'facebookmail.com' and 'move to Facebook folder. (I had entered facebookmail.com within the bottom box on the Rule Address screen that says From)

When I receive an email notification the email is not going to the specified folder?