Chinese Bloggers on Censorship, MSN, Etc. · Global Voices
Rebecca MacKinnon

At CNBlog, Isaac says: “Don't Use MSN Spaces, ” and creates a NoMSN Technorati tag for the boycott movement.
Kaihong posts a screenshot on Flickr showing results similar to what I found: the blog's title is filtered, but he was able to post sensitive words in the body of the blog.
Wangjianshuo (in English) describes the website registration process.  He says his site is “almost legal in China,” and that the process so far has been surprisingly easy.
Chinese bloggers respond to Microsoft's Robert Scoble:
Beijing-based (registered, blogging on WordPress) Doubleaf says that while Scoble may have met some Chinese who were critical of American style democracy, it's ridiculous to conclude that the Chinese are anti-free speech. “Chinese people are people too, how could we not like freedom and democracy? The words ‘freedom’ and ‘democracy’ are written in black characters on the white paper of the Constitution of the People's Republic of China.” He points out that even China's current governing bodies use the language of democracy. …  毫无疑问，中国人也是人，对民主自由等人类共同的财产有着天生的向往。”Without question, the Chinese people are people too, and have natural aspirations to things like democracy and freedom, which are common human property.”  Note that Doubleaf's blog is legally registered in Beijing, and he is using the terms “freedom” and “democracy” repeatedly on his blog. Note also that it's possible to use these terms while at the same time not saying anything critical of the current regime – something he does skilfully.
Hopesome (legally registered in Fujian) reprimands Scoble: “China doesn't have a single law or regulation saying that sensitive words like “democracy” and “freedom” should be forbidden.”  He continues: 而且，许许多多的中国人关于民主和自由的理解和世界上其它国家，包括美国，的理解并没有本质的区别。”What's more, there is no fundamental difference between the way in which many Chinese people comprehend democracy and freedom, and the way in which other people around the world, including Americans, comprehend it.” (Again note that Hopesome is blogging from within China on a Chinese server, on a legally registered blog.)
Li Dan (writing in English) points out that the words “democracy” and “freedom” show up in the State-run news site Xinhuanet quite frequently.
China's long-time problems with Microsoft:
One thing many people may not realize is that Microsoft has a long history of p.r. problems in China, and that the “anti-Microsoft monopoly” sentiment is very strong both in parts of the Chinese government bureaucracy (who don't want to be overly dependent on foreign software and thus prefer Linux-based systems for national security reasons) as well as amongst independent Chinese techies and bloggers who are concerned about the concentration of too much power in one foreign software company –  which many believe is stifling the emergence of a homegrown software industry.
We are reminded of this context in a long post on Klogs.org (in Chinese, hosted in the U.S.) , which describes how both Chinese bloggers and the Chinese government have had it out for Microsoft for a long time.  He points to an article posted on a blogger portal site complaining that MSN Spaces blogging service is illegal, because it hasn't adhered to the same registration procedures that all other blog-hosting companies have been required to go through.
He then points to the blog, Chinese Center for the Study of Blogs, which also argues that MSN Spaces is illegal My translation of a small excerpt:
The old saying goes: When in Rome do as the Romans do [loose translation of idiom]. If you're going to play the business game, you must follow the regulations.  If MS wants to play the blog game in China, it must follow the rules, right?
But MS has not followed the rules. The Chinese government regulations forbid foreign investors to engage in internet content services,  and MS has no right to develop a blog service as an internet content provider (ICP).  MS naturally is unwilling, on one hand it wants to get around this regulation by cooperating with a Chinese website; on the other hand it loudly proclaims and promotes MSN blogs, hoping that if it makes an assertive first move and pulls in a lot of web users, it will create a fait accompli. Their logic is just that simple, once it gets a large number of Chinese users, then MS's negotiating position with the Chinese government will be strengthened.
What does MS say in its negotiations with the Chinese government?
Isn't it about taking more software market share from Chinese-produced software?  Or is it about protecting China's information security?
Or about bringing down the price of Windows, so that they can make more money off of the labor of the impoverished people? Who knows.
Here is a similar argument written by an organization called the “Blogger Alliance to Oppose Microsoft's Monopoly” (反微软垄断博客同盟).  Here is the group's statement of purpose.  More stuff by the group here and here.
If somebody would like to volunteer to translate these things from Chinese to English in full, I'm sure that would help illuminate the whole context of the MSN Spaces p.r. fiasco.