Spell check broken after upgrading to Office 2007
Delete the following registry keys:
HKEY_CURRENT_USERSoftwareMicrosoftOffice12.0OutlookResiliencey
HKEY_CURRENT_USERSoftwareMicrosoftShared ToolsProofing Tools1.0Overrideen-US
Also make sure the proofing tools are not listed in the disabled items.