"why was it still there when i had deleted all outlook folders?" you didn't just DELETED outlook's folders, right?
maybe reinstalling outlook in an other location..?
maybe deleting it's registery before reinstalling?
anyway, I hate outlook... I've used it for some years, but when Worm_Klez appeared it was impossible to work with outlook (auto-downloading the messages context)... try moving to msn-messanger (using Hotmail's mailbox)..