Since it's sort of the same subject, I'll repeat the note in the Tech: WinXP New Deal thread -
A newsmail I just received notes that Microsoft released a new verification applet (June 26) that reduces the "call home" attempts from "every time you boot" to "occasionally." If you don't complete the verification successfully, it still will "nag you frequently." The new version also has a "new EULA" that attempts to explain more clearly what the verification does, so you'll likely be asked to read and agree when you log in to fix things and/or when the new applet downloads with your updates.
Also, there's a report of a new worm that "mimics" a message from or about the verification program. It's being distributed mainly via AOL "instant messaging" but if you click anything in the message "for more information" it disables your firewall/antivirus, installs malware to steal info from your computer, and opens a back door to let someone take over your machine for SPAM or DDOS attacks, etc. (All the usual stuff.)
Re the worm, as always, NEVER click anything in an email, IM, or other unsolicited message, no matter who it says sent it. If you're curious, make your own connection to the people the message claims to be from, and get the info, if any, from the source, via your own connection.