Cached mode no longer works with NTLM authentication

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Im using OL 2010 on a hosted exchange server. The host must have updated something the other day even though they deny it as my home computer that was left on, and logged in overnight had a message that because of admin changes I needed to log out and then back in. After powering up my office computer which was off at night would say it was connected to the exchange server (in cached mode) and I would see new messages, but when I tried to create or modify and OL item OL would just hang.

Deleting the OST file didnt help although working in non cached mode did appear to work OK (authentication still set NTLM).

I changed the proxy settings from use NTLM authentication to basic authentication and it now appears to be working OK again in cached mode. My question is unless someone can comment on the actual cause of the problem, in simple terms what am I sacrificing by switching to basic authentication?

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