Hilary, I did not disable "InfoPath E-mail Forms" in Outlook prior to what I tried. What I tried in order is as follows:
1. I did a repair on Office 2007 as a whole, that didn't work.
2. I uninstalled InfoPath then reinstalled it, that didn't work.
I guess the only thing left to try is to uninstall the whole Office 2007 suite, which I find odd and likely that it still won't work...but if you agree...I'll try it.
I also noticed that when I reply to an e-mail that has a InfoPath form attached and I get the error message that I submitted, when I go back into Outlook the "Enable InfoPath E-Mail Forms" option is disabled again...it does this on it's own.