Do archived folders/files in Outlook 2007 use the same ammount of space as
the original Outlook files? If so, what is the advantage of archiving?

The Archive option moves data, based on an aged date, which you can ammend
in archive settings, from your current data file to an archive data file.
As I recollect the default Archive setting is for 'older than 6 months'
Your current data file will be reduced in size as the data is no longer help
in that data file. It might also make your data more managable from a user
point of view.
You can have the Archive data file open within outlook and old data is
accessible
Some peoples keep seperate archives by year, ie Archive2007, Archive2008 etc

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