Dave's solution just made my Outlook 2007 email work again with his advice on checking the personal firewall settings in the anti-virus software on my machine. Sure enough, there was a "deny" instead of an "allow" as the newest Microsoft Outlook permission status in the "Exceptions" tab of my firewall software (which also happens to be Trend Micro PC - cillin Internet Security). Don't know how it got there, and there were also several repeats of other rules for Outlook as well. I deleted the "deny" and the extra "allow" settings, and all is now well. I was initially looking at other possible reasons as to why I couldn't receive or send email suddenly, including a recent mail server upgrade that happened where I have my email/website hosted, and also the latest download of VISTA Service Pack 2. Both of these happened within a day of my email being messed up. But, they weren't responsible.
Trend Micro PC-cillin updates its software regularly, and did so just before I lost access -- I suspect this was the cause of the email failure. So you are right to advise people to check their firewall settings and the exceptions to see if there is anything wrong. For anyone needing step by step instrux, here's what you do:
1. Open the control panel of Trend Micro PC - cillin
2. In the Summary screen, click on Configure
3. In the Protection Summary, click on Personal Firewall
4. Check the various Profile Names by clicking on them, and then the Exceptions tab
5. As Dave noted, look for repeats for the same software, and check the Action column to see if it says Deny or Allow -- when I deleted the "Deny" rule, I was then able to set up my email accounts once again and receive/send mail