Thanks for the detailed writeup Jess! I found the Join Now! link using your steps. Windows Live ID is the authentication method for officeliveworkspacecommunity.com but you still need to register on the site with a unique username, etc so you can post and interact with the forums. I've been a member of the communities for some time now but I still experience the same behavior you've seen of not being able to sign out.
Workspace is a great product (sure, I'm a bit biased) and very helpful storing documents on our site so you can take them with you and access them anywhere as well as share and collaborate with colleagues and friends. I would encourage you to check it out for yourself, even if you simply upload test documents and share them with a friend.
We currently support uploading many filetypes, include Office Word, PowerPoint, and Excel; these programs I would imagine are installed on your laptop as part of Office 2007. We also support uploading and viewing other files like PDF.
Our goal is to keep Office Live Workspace a free service.