Can't change message format in Outlook 2007

pdx

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30th Oct 2008

I am unable to change the message format in Outlook 2007 from Basic Text. It
is set in Tools -> Options - Mail Format as Rich Text, but when a new message
si opened it opens as Basic and the option to change is grayed out.
I have re-installed Office 2007, uninstalled and re-installed, done a sfc
/scannow, etc. I'm about to do a re-install of Vista (business) and see if
that does the trick but I'd rather avoid that if possible.
Is there an Outlook specific template I can delete and see if that restores
functionality or any other suggestions. I googled on this and turned up the
question but no answers.

Thanks

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