I uninstalled O2k7 for other reasons.
Have you tried starting Outlook while holding down the control key?  That will prevent WB from touching it at all.

Just read this ... This is taken from my subscription to Gizmo Richards support alert newsletter dated March 15th

Microsoft Security News
an update to the AV Engine in Windows Live OneCare locked Outlook users out of their email because it decided to quarantine the entire email catalog .PST file if it found a single infected message


Just found this as well from C/net news
Windows Live OneCare eats Outlook mail for lunch
March 8, 2007 1:38 PM PST
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A recent update to the Microsoft antivirus engine for Windows Live OneCare will quarantine the PST file used to store e-mail messages for Microsoft Outlook, preventing access to messages, appointments, tasks and journal entries. It affects versions of Outlook, including Outlook 97 and 2000, and Outlook Express running on Windows XP when the .pst file contains an infected attachment. Microsoft will issue an update on Patch Tuesday, March 13, 2007. In the meantime, in a post on one of the Microsoft forums, Microsoft representatives suggest the following actions to regain access to lost e-mail:

1. Close the Outlook or Outlook Express application.
2. Click Change OneCare Settings in the main OneCare user interface.
3. Click on the Viruses & Spyware tab.
4. And then click on the Quarantine button.
5. Select the PST or DBX file.
6. Click Restore.

Once the e-mail file has been recovered, you'll also need to change the OneCare antivirus settings affecting future virus scans. To do so, follow these instructions:

1. Click Change OneCare Setting in the Main user interface.
2. Click Viruses & Spyware tab.
3. Click on the Exclusions button.
4. Click on the Add Folder button.
5. Navigate to the specific folder that contains the DBX or PST file to be excluded.
6. Click OK to finish.



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