HI,
it's not that easy but not too hard either, on the other hand. :-)
Thunderbird is actually supposed to look for the recommended Pop3, Imap and SMTP settings of your mail server in its database based on the address you provide, and since Yahoo is one of the biggest providers in the US, as far as I gather, it seems strange to me that it doesn't support it. Outlook Express doesn't have such a feature, however, and you have to type everything in manually. sometimes, especially the first time when you don't have any idea about the required parameters for your specific server, this can be a bit of a pain, having to look the necessary information up on the provider's website. On the other hand, as if this was not enough factors to ponder already, I've heard that certain controls in thunderbird are not read all too well by Jaws, and I can't unfortunately remember which ones those were exactly any more. NVDA reads it perfectly though, and I don't know about any other screen readers. Not to mention that, as far as I know, Outlook Express can't be installed on a Windows Vista or 7 machine, but since you have already run it, I suppose you have XP with the program installed, or my assumption about Vista and 7 is wrong. That's how I migrated to Thunderbird, however - I couldn't seem to find an installation package of Outlook Express for Windows 7 anywhere when I got my new laptop last December, there was absolutely no e-mail client installed in the system by default at all and I really didn't want to install the huge Windows Live Essentials mammoth just for a lightweight e-mail client like Outlook Express used to be. So good bye to Microsoft in yet another area of services I said then. :-D
So, if nothing forces you to use Thunderbird or prevents you from using Outlook Express, I recommend you to stick with OE for as long as you can because it's really fast, stable, lightweight and easy, but you will have to create your account manually the first time. Just in case, what did you try to do in Thunderbird? If you chose the account settings item in the tools menu, clicked on the "account actions" (a rough translation back to English from my Czech localization, sorry) and chose "add e-mail account" in the menu that just popped up, you should have gotten a dialog where you are asked for your name, e-mail address, password and possibly a few other pieces of information. Then, if you click on a button of the "ok", "done" or "create" sort, it should start looking up the correct settings for your mail server automatically.
Identities and accounts in Outlook Express are actually two different things. An identity is your user profile so a main or default one has already been created and initialized with default options, which I recommend you to go through and customize to your liking by finding them in the tools menu and then browsing through the whole dialog window and all the tabss carefully. So you can store as many identities or user profiles on one computer as you want, and have equally as many individual e-mail accounts in every one of them for that one user. Thunderbird does offer a similar functionality as well, I believe, although not by default and you have to do a kind of trick to enable it, the instructions for which can certainly be googled somewhere.
I can't test Outlook Express any more so I'm afraid I won't be able to give you exact step by step directions and will rather have to suffice with what I could recall just roughly. In the file menu, there are some items related to identities which you can use to add new ones, remove or manage existing ones, add passwords to them so that only you can actually use that profile, etc, and under tools there should be an accounts item or sub-menu, pretty much like in Thunderbird. you will want to ffind a command called add, that should open up a sub-menu and you want to choose e-mail account from there. The first prompt in the guide that comes up then is similar to the account creation screen in Thunderbird, it will ask you for your name that you wish for the recipients of your messages to see, e-mail address, the user name and password, etc, it's slightly different from the one in Thunderbird. And further on is where the trouble begins, you will have to complete that guide and then possibly enter the accounts dialog again and modify the properties of the just created account somewhat, that depends on what you can find about setting up Outlook Express to work with your inbox on a specific server.
Hope this helps, and good luck!
Lukas

hi am i able to creat an acount using thunderbird and hotmail?
also is it werth it?
can i do the same thing as in outlook rread emails delete them and so on and so on?
thanks for helping.

I've never fiddled with address books in either OE or Thunderbird so I can't tell. I've always just pressed control-n to compose a new message (this keystroke is identical in both clients) and started typing the address or name of the person into the "to" field. it always got autocompleted, and that's one of the features of both clients that I like the most.
Thunderbird can in deed do everything that OE can, well, perhaps except for the address book, it does not have any excessive rubbish that belongs to organizers or other kinds of software, and it even has something more such as a cool self-improving spam filter.
In that case, Chris, it appears you did everything correctly. I don¨t know how long you waited with that dialog in Thunderbird with the cancel button but I know it must have taken at least a minute or two for me until the screen changed and it let me know that the account has been set up, so you might want to wait a bit longer.
Hope this helps,
Lukas