We use to have to trick Hotmail to get it to send to a pop3 account, but recently M****soft decided to make pop3 available FOC from Hotmail. This means no more of the "hotway hotsmtp" stuff.
For most of us, setting your account up like this is all you have to do
Link (1) Here
Link (2) Here
If Evolution is still not working, make sure you didn't install xinetd (as the methods above tell you to) as that will cause problems with Evolution reading Hotmail now that it's free