For Christmas my daughter is already asking for a netbook with Windows 7... because she wants more "Happy". If little Kylie can handle publishing and emailing under Windows 7, then my 10 year old should also be able to. Her old clunker running XP needs to be retired, so I'm not totally against the idea...

Yep, that will do it. There is a relationship between CDOSYS and Outlook Express. So, you should not remove Outlook Express if you ever expect to use CDOSYS or have anything which uses CDOSYS work properly. Some people get very ambitious about security and start ripping-out software which they don't...