I remember this problem has been posted before and Patchou fixed it for 4.23.
Nickname Format Problem in Chinese Simplified WLM
"Format" button for nickname disappear
quote:
Posted in Changelog for Messenger Plus! Live 4.23.276 (05/06/2007)
- Fixed: the "Format Codes" button is not added in the Messenger options in Chinese versions of Messenger.
quote:
Originally posted by kaiconan
Does Plus! will fix this problem? When will release the fixed version?
If possible like the above case, why not! Just wait for the new Plus! which is currently in beta test stage, I don't know a scheduled date for release.
You can use /nick, /name (even /nick2) commands and the format panel in conversation windows to easily colorize and format your name. These commands even give more functionality then that Format Button in Options
/ 
