Now, something you might be confused about is that the Motorola Droid does not support all of the Exchange ActiveSync Policies ... Such as the policy that requires you to lock your handheld and have a PIN code to unlock it (which most Exchange administrators have enabled as a policy on their exchange servers). In this event, your Exchange administrator MUST add your username as an exception to the policy rules that are on that Exchange Server ... OR ... You must install Touchdown (from the app store). Touchdown supports all of the required Microsoft Exchange ActiveSync Policies, so no exceptions will have to be made.
I personally don't use Touchdown ... I'm the Exchange Administrator for my job, so I just added my username as an exception and BAM, it worked instantly!
I'm also too cheap to shell out $20 for an app I don't really need. I'm happy synchronizing my Inbox, Contacts and Calendar with my Exchange Server. My Droid has synced with my server since Android 2.0. Worked even better on 2.0.1 and is working phenomenally well (no more occassional crashes of the email program) since my upgrade to 2.1.