After a recent SBS2008 implementation where the mail and data were coming from and SBS 2003 installation – the annoying popup message Connect to server xxxx.xxx.xx message was displayed for a client with Outlook 2007. The two giveaways in this behaviour 1) it references the external email address of the domain mx i.e mail.xxx.com where xxx is the internet domain and 2)it reappears no matter what password and username its given – even though mail delivery completes successfully.
Having seen this recently in correspondence – I check with a colleague and was reminded that there was a reg fix for this. Transferred a .reg to the client opened and accepted it and lo the pesky message is gone.
So if Outlook seems to be displaying the characteristics mentioned the reg fix is
Windows Registry Editor Version 5.00