Ok. Below you will find exactly what I did to get this to work. The main issue is related to mapi32.dll files conflicting with each other.
This procedure was based off of a new build. You may be able to uninstall all the apps & get xp to a vanilla state or if you have system restore enabled, restore to a point prior to the win2k3 snap-in/exchange snap-in, call pilot, & office 2007.
Install the apps in this order:
1) win2k3 System tools
the install the exchange snap if it is needed
2) XP sp3
3) additional windows updates
4) MS office 2007
5) MS sp1
(I believe two is availble, but just install one for now)
6) Install call pilot.
7) Reboot.
8) add the call pilot to the default mail profile prior to configuring the user's email.
9) open outlook 2007
10) you should see the call pilot as the default profile.
close outlook
11) open control panel & click on the mail icon
click on email accounts
12) on the first tab click new & go through the process of setting up the exchange account for the user.
13) launch outlook 2007 & you will be prompted for your call pilot credentials & then outlook 2007 with call pilot with win2k3 tools will work.
In the event that this doesnt work you may have to fore go having the exchange system tools on the machine, the win2k3 admin tools can remain on the system.