I downloaded and installed the MSN Toolbar Suite beta with built in local search. It seems to be well behaved and do what it is supposed to with nice integration with Hotmail, MSN Spaces and MSN Messenger and it does fast local searches(at least of Outlook mail store, Messenger conversations and local identifiable files). The MSN web search still sucks so I also still have Google's toolbar running (I had problems installing Google's local search feature and as local search wasn't a priority, I never really got it running and never tried to chase the problems down).
Robert Scoble seems excited about this product(and a whole bunch of bloggers with reviews are linked to at Scobleizer). Somehow I just can't get excited about it -- maybe living with it and using it for a while is in order.