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This problem sounds like one that is widely reported and whose solution is described in the Microsoft article "The Compose Message form stops responding after you install Internet Explorer 7.0 and the S/MIME control on an Outlook Web Access client in Exchange Server 2003." Please read this article and report back to us if it resolves the problem.
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Related information from SearchExchange.com:
Expert Advice: Internet Explorer 7 causes Outlook Web Access issues
Tip: Exchange Server 2003 SP2 and IE 7 compatibility problems
Administration Guide: Outlook Web Access
Reference Center: OWA tips and resources
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