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For an Exchange mailbox (specifically 2007) an e-mail address can be added to the "E-Mail Addresses" tab of a user account.

What is the effect of adding an external email? for instance, the user's hotmail address. Does the email go to both the domain.com and the hotmail.com addresses? Is this effectively the same as forwarding but without the need for a contact record?

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Can you clarify which field you're referring to? A screenshot would be good. – Shane Madden Aug 31 '11 at 22:17
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Because I just so happen to have an Exchange 2007 testing VM just lying around... I gave this a go.

As I suspected, if I add the email address ben@acme-corporation.com to the email addresses tab, Exchange will gobble up the email and send it to my mailbox. As far as Exchange is concerned, this message has been delivered and it will not attempt to send it on to acme-corporation.com, or Hotmail in your case.

To be clear, acme-corporation.com is not on my accepted domains list, and I could add any random address to the email addresses tab of my mailbox and have Exchange accept email for it.

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To add a bit: The only objects that Exchange is capable of forwarding email to via an external email address are Contacts and mail enabled users (not mailbox enabled users). As Ben stated, if he adds BPilbrow@hotmail.com as an email address to his user object then Exchange will deliver any internal email addressed to this email address to Ben's Exchange mailbox. It will not forward the email to BPilbrow@hotmail.com. In addition external email addressed to BPilbrow@hotmail.com will never reach Ben's Exchange mailbox as his Exchange server is not authoratative for the hotmail.com domain. – joeqwerty Aug 31 '11 at 23:16
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