I verified this in IE 8 (on Windows XP SP2 & Vista) by clicking the Delete button in the Browsing History section in the General Tab of Internet Options. I believed this "Remember me" feature depended on cookies & should go away on deleting cookies. I even closed the browser & re-opened the browser after 10 minutes to see the user name still there. On deleting cookies in Chrome though, the user name does go away.
I found that in the Hotmail/Windows Live Sign In page, only on clicking the X mark that you get on hovering near the user name (which represents "Don't remember this Windows Live Id") can you make the credentials go away.
I checked with my Indian MVP colleagues what the reason could be for this intriguing behavior in IE 8. I got to know from Windows Client MVP Ramesh Kumar that this is because of the Windows Live Sign-in Helper, an IE 8 Add-on that is enabled by default.
The purpose of this Windows Live Sign-in Assistant is to provide sign-in support for multiple IDs. It has been provided to make the sign-in experience faster and more convenient for users that have more than one Windows Live ID account.
So this explains the mystery of the credential persistence for those who are not aware of this IE 8 Add-on. The Windows Live Sign-in Assistant article explains what you can do if you don't need this feature -
If you decide that the Sign-in Assistant is not for you, you can disable it by going to the Tools menu in IE, selecting “Manage Add-ons”, highlighting “Windows Live Sign-in Helper”, and then choosing “Disable” in the settings box. Alternatively, you can remove it permanently by using the “Add/Remove Programs” dialogue in the Control Panel (it shows up as “Windows Live Sign-in Assistant”).
Also see:
HOW TO create your own IE8 Accelerator
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