I thought that for the record it might be helpful to report back on the situation in my experience with regard to Microsoft mail accounts (in my case Hotmail) and XP SP3 clients.
EssentialPIM: couldn't complete installation.
Roytam's MailNews does install and supports OAuth2, but does not yet successfully validate Microsoft accounts. He acknowledges the problem.
OE Classic: works well and is being updated. I have had stability problems with it when attaching files, but touch wood it seems fine now. The three year subscription is a drawback, but I guess they have earned it!
Dream Mail: installed this successfully with AstroSkipper's aforementioned loader. It also works well and is free; as it is offering updates up to the highest version 6 only, my impression is that the latest version 7 updates do not support XP.
I haven't tried forwarding as in the previous post as I wonder how long this will work.
Overall, my preference is for OE Classic. The interface is quite similar to Outlook Express, and thus familiar, and to me much more appealing visually than Dream Mail's, which isn't very easy on the eyes. It has some marked improvements over Outlook Express, as compacting folders, always a complex, slow, risky and rather fraught process in Outlook Express, seemed instant and easy. Messages, even in quantity, can imported and exported as .eml files, which allows them to be interchanged with Outlook Express. It can import dbx folders, but I haven't tried this as I wanted a clean start. It did successfully import my Address Book, but not groups within it. Outlook Express did seem faster, and I miss the stationery creation wizard, but am probably alone in that respect!