You can only change the font size for the Reading Pane in Outlook 2003 by right clicking the tiny grey border around the Reading Pane.
When you do click the menu item then move to another email, the option switches back to Medium for the next message.
The menu items have no effect (the font sizes don't change) on 90% of corporate mail including RTF and WordMail.
Is this totally broken or am I totally broken?"
I can't find a way to make the change permanent either, but:
Some users prefer the better visibility of a larger font size for reading their messages in the Reading or "preview" pane. You can make the text or font in the pane larger or smaller by using the scroll wheel on your mouse. Using the scroll wheel is the only way you can change the text size, although more options are being considered for a future version of Outlook.
Use the Reading Pane, highlighted in red, to preview your messages without having to open them. Click in the Reading Pane, press CTRL, and roll the scroll wheel. Rolling the wheel away from you makes the text bigger, rolling it towards you makes the text smaller.
Note The text size doesn't persist when you change views. If you go to your Calendar, for example, or another mail folder like Sent Items, the text goes back to the default size.
For information about the OL interface, see Slipstick.com.