The ability to encrypt MAPI connections in Microsoft Office Outlook 2003 isn’t enabled by default as it is in Office Outlook 2007. If you want to enable encryption of MAPI connectivity between Outlook 2003 and Microsoft Exchange Server 2003 and higher, you need to make a change to Outlook 2003. This change is a registry value which can be implemented through Group Policy (Policy template file OUTLK11.ADM) or the Custom Installation Wizard (CIW) for Microsoft Office 2003. See also, "How can I configure Microsoft Office Outlook 2003 for digital signatures and encryption?"
You can also manually make the registry change. If it doesn’t exist, add the EnableRPCEncryption value of either 1 for enabled or 0 for not.
RPC encryption isn’t the same as encrypting individual messages. RPC encryption only encrypts the data stream between Outlook and Exchange for MAPI connections. It isn’t specific to a single email message.
This is an important setting if you are moving to Exchange Server 2010, which requires encryption from its MAPI Outlook clients. Exchange Server 2010 will support Outlook clients back to Outlook 2003 SP2 for MAPI connectivity. However, for Outlook 2003, encryption between Outlook and Exchange must be enabled on the client. You will need Outlook 2003 SP2 to connect to Exchange 2010.
Learn more from "Exchange 2010 and Outlook 2010: The Return of "Better Together."