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In case you are not aware the Telnet protocol handler is no longer supported in Internet Explorer 7. I will leave the speculation as to why Microsoft decided to do this to others, but there is a fix available to rectify this insane decision.
I have run this fix and it restored my ability to Telnet as I had been able to do in versions prior to Internet Explorer 7. NOTE: The fix will make a change to the registry.
By clicking on the below link you agree to hold Al Lawrence and Sunrise Door Software harmless from any damage this may cause to your computer system.
http://www.lib.berkeley.edu/Catalogs/IE7_telnet.reg
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