As referenced previously we migrated our staff from onsite Exchange Server to Live@Edu in April and haven’t looked back since then. Around 30 staff are hooked on using Outlook 2007 or 2010 to access all parts of their Exchange mailbox on Outlook Live, and using the webmail where necessary. A few staff are sharing their own calendars or contacts with other staff. Outlook 2010 adds some useful enhancements including password caching and free/used space display for the hosted mailbox.
One issue that came up was with the updating frequency of calendar events, which is important when users are sharing calendars used to book appointments etc. I found there are some group policy settings covering these which are found in User ConfigurationPoliciesAdministrative TemplatesMicrosoft Office Outlook 2007/Tools | Account SettingsExchangeCached Exchange Mode with three entries to do with sync, upload and download times. We set all three to 60 seconds and have had no further concerns about sync time. The policy settings say there are defaults of 15-60 seconds for these settings, but it was unclear whether the remote server could override them.
Essentially because all email (except for internal between user accounts on the same domain) is always reliant on external servers such as those provided by ISPs, concerns about the reliability of hosting mail externally are not really significant and in any case the Live@Edu solution has been reliable with the most issues being local connectivity.