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I am not a Hotmail user. But I do have a gmail account and have set up Outlook to be used as the client and have set options as I described above for my gmail account. Then if reading my email and managing my account via Outlook I don't have to worry about return receipts.And there in lies the problem. I don't believe I can change the option with Hotmail.
I do the same for my ISP email account. My Outlook mangaes six different email accounts (2 gmail and 4 from my ISP). These also come through to my Blackberry. Gmail uses IMAP with SSL and TLS. See here for instructions.
Here is the instructions for setting up Outlook for Hotmail.