Hi,
As fas as I know Hotmail can't be used that way, with SMTP and POP3 that is. What you can do is add Hotmail as an HTTP server. This way you can use Outlook Express to send and receive messages on your Hotmail or MSN account.
In earlier versions is wasn't possible to move messages to offline folders within Outlook Express, in new versoins of Outlook (Outlook 2003 for instance) you can.
It might be possible with Outlook Express 6 also, I'm not sure about that.
Hopes this helps.
Edit: Spelling...
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