The computer in question is a Win7 HP notebook belonging to a friend. She only brought me in to question me on the Outlook>>browser problem after I put Opera on her computer so she would have the VPN feature.
Since it worked fine with Chrome set as default, but not with Opera, I just put her back on Chrome and told her to surf and explore the web only with Opera.
Then I added, do not open any more links from Outlook of which you are not sure. (The splash message popping up on screen from the "MS" guy in India who wanted to cure her trojan problem was the start of all this!)