Re: What I don't understand is .....
"I'd start finding some cutlery then. From a legal perspective, MS cannot be allowed to win as it creates a dangerous precedent, also for law enforcement - it would, for instance, than have allowed Enron to hide its information in a data centre abroad."
Not necessarily. The data in question doesn't actually belong to Microsoft, it belongs to an EU citizen that's resident in an EU country and protected by EU privacy laws. In your Enron example, the data would still have belonged to Enron no matter where it was located.