I ran into an issue where Outlook 2007 on Windows XP on Exchange 2007 wouldn't autoconfigure and specifically didn't work with Outlook Anywhere. In my case, the mutual authenticaiton piece was failing. Thanks to this site for helping my diagnose the issue. The problem is with SAN certs. For mutual authentication to work with Outlook Anywhere, the FQDN for the external hostname used must match the Issued To field of the cert and doesn't work if you use an external hostname specified in the Subject Alternative Field.

In my case, I disabled mutual authentication by issuing a Set-OutlookProvider EXPR -Server $null -CertPrincipalName none command. The main symptom of this problem was the client would stick on the authentication piece of the Autoconfigure process. The user would experience endless authentication (password) prompts. I hope this helps!