You are viewing on screen? If so, correct, there is no line wrap.
If you are printing the calendar, do you have SP2 installed? Or use the Calendar Priniting Assistant. Both have line wrap.
For viewing onscreen, if you make the window as wide as possible, you can see more subject and hovering the mouse over the subject will display all in a tooltip. Also, if you use the Day/Week/Month view with autopreview, you'll see more details in the tooltip.
There may be other calendar programs that meet your needs better (especially if you are only using Outlook for the calendar), unfortunately I don't have any suggestions. The Live Mail client from Microsoft works like Outlook- no line wrap in the monthly view onscreen.