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Exchange Outlook Account Will Not Connect to Microsoft Exchange Server But OWA Works Fine

I have a user in New York that accesses his E-mail via OWA. All works Well, with that said when i tried to set up his outlook 2007 client it would not work. kept asking for username , password.
So what i did is i went to a prompt telneted server 110. connects fine.
type user "username"
pass "password"
then get the following:  -ERR Logon failure: unknown user name or bad password.
with that said if i use my username from his computer through telnet i have no problems.
I have gone a step further to try it internally via the internal IP and the exact same thing happens.
All i can figure is something is messed up on my exchange server. any ideas.
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ok they were not. so i added an alias to match. can i force an update to test. or should it be instant.
If DC's are in same location. Then it will be immediate. Test it. Give some time to replicate, if DC's are located in various locations.
You can also force the update. I hope this should resolve the issue for this user.
Try this login syntax:

Username: domain name\username

for example:  mycompany\johndoe
to no avail on the domain \username
for hell of it im rebooting this exchange server which never happens. Makes my stomach hurt to reboot
for the problems that just appear in my experience. we will see what happens.
Ill update you all soon as she comes back.
Hi LinuxDude,

Am I correct in assuming that the PC is on the same AD as the server?  If so, is the PC name and the username the same?

PC and user name are diffrent. His laptop is not part of the domain.
His username is setup in AD with and email account. which does work in OWA
Thanks for the quick comeback.

OK, so then is the Exchange server published with a Public or Private cert?  If a Private Cert, has the Cert for the Exchange server been added to the Trusted Root Certification Authorities?

Sorry the last sentence must read " If a Private Cert, has the Cert for the Exchange server been added to the Trusted Root Certification Authorities on the CLient PC?"

No, but at the same time i can log in from there using my credential. I really thing it is on the exchange server where the problem is. It is a private cert. i will add to trusted sites to test now though.
adding the cert did not help.
You mentioned "add to trusted sites ".  Do you mean with this that you added the URL to the trusted Sites in Internet Explorer?  This is completely different to adding the Certificate to the Trusted Root Certification Authorities store.

OWA will work because there is no level of authentication trust required apart form username and password as the web client effectively runs of the server.  Outlook on a PC requires the PKI certificate to create a trust relationship between the PC and the server.
you must have the Pre windows 2000 alias setup when you initialy create the email account. if you create it after it will not work.