Other then the convert tab there are no other tabs inside that bar, nor other plugins or addons which add something there...
With the convert tab you can write text with your mouse and it will be automatically converted to typed text.
For the convert tab to work you first need to
enable handwriting. But the convert tab will still not work after you've installed the Ink Redistributables and/or the full plugin. For this you need to register another DLL which used to be on this site:
http://www.mongfish.com/msnmsgr/.
Note that the handwriting plugin from TheBlasphemer is designed for MSN Messenger 6 only, and can even give conflicts when used in MSN Messenger 7. The link provided by Lee Jeffery is this specific handwriting plugin (with convert) for MSN Messenger 6.
To get the convert tab in msn messenger 7 you need to manually copy some language specific DLL as describe above, unfortunatly the site is down atm.
/ 
