I have had the same problem for 2 days.  I have tried everything and still cant get Windows live mail to work.  I hate windows HATE!!!

Unable to send or receive messages for the Hotmail.co (xxxxxxxx account.

Server Error: 3204
Server: 'https://mail.services.live.com/DeltaSync_v2.0.0/Sync.aspx'
Windows Live Mail Error ID: 0x8DE20003

Split from an unrelated thread