I found this at
http://forums.microsoft.com/MSDN/Sho...29361&SiteID=1
"This was a difficult, deliberate choice. During the development of Vista, it was discovered that the password storage algorithm used by Outlook was too weak to protect your data from future, potential attacks. Both the security and application compatibility teams decided that protecting your data outweighed the inconvenience of having to retype your passwords. As the appcompat representative, I can assure you this was not a decision we took lightly, and my apologies for any inconvenience we've caused you."
"Microsoft AppCompat Guy"