Where I work, the exchange server keeps the user mail on the server as well as in a local outlook.pst file. Some users prefer to auto-archive their emails (since they get so many) and this has caused issues since files are then not stored on our servers but locally. so if a users PC goes down the doo-doo really hits the fan. By default our users get 250meg of disk-space but, of course, this isn't enough for some folks and instead of clearing out their mail boxes they'll opt to autoarchive.
This system seems to work fairly well. We have backups going back many, many months so if a user's PC is trashed and they have their mail stored on one of the mail servers, we can usually restore their entire Outlook for them.
