This is not the fault of LSoft, its Exchange's doing. You will have to
add a registry entry under

HKEY_LOCAL_MACHINE
  \SYSTEM
    \CurrentControlSet
      \Services
        \MSExchangeIMC
          \Parameters

Name: UseRTFText
type: RegDWORD
Value: 0

This will prevent it from adding the ">" signs to all outgoing messages.
Note that this will mean every message you reply to or forward, or any
messages which you paste text into, will not have the ">" in front of it
for all your clients. It does solve the problems of being able to reply
to PUTs though.

Cheers,
Russ
R.C. Consulting, Inc. - NT/Internet Security
owner of the NTBugTraq mailing list:
http://ntbugtraq.rc.on.ca/index.html