This is more of an answer than a question, about setting up the outlook 2007 email client.

I used the instructions detailed on the att website (the written/illustrated instructions) to set up the outlook 2007 email client, but I couldn't get it to work.  I followed the instructions relatively well, but kept getting the dialogue to enter the username and password (again) when I tested the connection.   Note that I was able to use the web email client, but not outlook.  Finally, I found the link to use the at&t automated tool, installed it, ran it and outlook still didn't work, but it did return an error I could understand and fix (For some reason the Require Secure Password Authentication (SP) box had gotten checked in the outgoing server dialogue.  When I removed the check for this, everything worked). Before running the tool if you do, delete the faulty account in Outlook, shut it down, then install and run the automated fix program.

Please note that the instructions for the outgoing server in the printed instructions are incorrect, at least for this windows computer (win 2007): do NOT check 'Use same settings as my incoming mail server', but select the 'Log on using' button and enter the correct information for User Name and Password and select Remember password. (all in the outgoing server dialogue). 

So if you use the automated tool and your email is still not working, check to see if the Require Secure Password Authentication (SP) box is checked if so uncheck it and test the connection again.  Hope this helps someone...