You can use your firewall to block the AOL activity from the machine. Setup will vary depending on what firewall you are using. If none you can configure Windows Firewall to do it. Let me know what firewall you have.
The only way that i have found to be able to send and receive email through outlook using Yahoo's email is by signing up for there Yahoo Mail Plus! for 19.99 a year. Once you sign your account up for that service they will allow your account POP and SMTP access and you can then set your Outlook up. Yahoo Pop Incoming Server : pop.mail.yahoo.com
Yahoo SMTP Outgoing Mail server : smtp.mail.yahoo.com
The username must have @yahoo.com as well.