A number of people, both at ESPs and on the mailops mailing list, are reporting problems at Hotmail. The most common reports are senders getting
Site hotmail.com (220.127.116.11) said in
response to MAIL FROM (452 Out of memory)
during the SMTP session.
There isn’t much senders can do about this. Hotmail is going to have to fix their resource issue. This may be limited to certain mail clusters, so watching the IP addresses reporting this error and avoiding them may help.