When I reply to an e-mail from Exchange Server 2003 either from OWA or
Outlook 2003, the email displays correctly but when I reply it email turns
into garbelled text from an HTML application (non-Microsoft). If I cc an
Outlook account, the message displays correctly.

Any similar experiences or suggestions?

What I would do as this sounds more like an Outlook issue is to go into
control panel and mail.  Choose profiles and select new.  Create a second
profile of your current Exchange account and then select that profile to be
opened instead of the current one.  Also, do not use copy profile but
actually just re create it.  See if the new profile works and even try
replying on some messages you had issues with before.  Have found many weird
issues in Outlook have been solved just by creating a new profile.  Good luck!

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