Have a look here: 1&1 Help Center - IMAP Connection Details for an Exchange Account
I appreciate you're using the .co.uk SMTP server as opposed to the .com but this lists the SMTP exchange server differently:
"Outgoing Server: smtp.exchange.1and1.com"
Worth a shot.
Have you tried using a different browser. eg: Firefox, Google Chrome, Internet Explorer, to check your email in order to work out if the browser may be having an issue working correctly with your email providers web site?
It is possible you have a setting turned on which adds addresses automatically as you reply to group/bulk emails? If so, all the recipients may be getting added by the system.
Send an email to an email address which is definitely NOT in your contacts and see if that address gets added...
You should be able to simply:
Open the native "Email" app.
Go to 'add an account'.
Enter your email address and password associated with the account.
The app should do the rest.
Is this Windows 8 by any chance? If so, have you tried to print the email from a computer running a different operating system?
Can you log into your email with a different browser and try again?
Can you forward the email to another, non-outlook.com email address, eg: gmail and try again?
At the bottom of the compose screen there are two arrows pointing to the right '>>'
Click them to enable rich text formatting. The option will then appear on that bar.
You could also try highlighting the text you wish to italicize and on your keyboard, hold CTRL and press 'i'