Password not accepted for msn.com account

Windows Live Mail 2011 Version 2011 (Build 15.4.3555.0308) / Windows 7 Home Premium SP1

So I'm having this weird issue with a friends email account. They thought it was an issue with the computer so they asked me to look at it.

Using WLM to access 3 email accounts 2 @verizon and 1 @msn.com.

Everything was working fine up till about 2 weeks ago. All of a sudden the msn account could not log on anymore via WLM.

I have changed the password and can log in to Outlook.com using this password, but still am being told it is incorrect by WLM. 

I added the account again using POP3 settings and then again with automatically provided  HTML settings. Nothing I try works.

I cannot figure out what is wrong. 

Both Verizon accounts work fine and I added MY @live.com account and it works fine. 

I even DL'd Thunderbird and the @msn account does not work their either.

Has something changed recently that would cause a security block on mail clients for @msn.com accounts?

Any advice would be appreciated.

Perplexed!!

[Original title: Password issue]