After running script against 270 mailboxes in our environment which had direct booking enabled. We had same issue mentioned by Josh i.e. Outlook 2007 users getting prompt to use single instance meeting (even though meetings were single occurrence) AND Outlook still trying to use direct booking.
As workaround, we used below registry on user machine to fix this, since it was only impacting Outlook 2007 users. (Direct booking is disabled by default in Outlook 2010 to my knowledge and Outlook 2013 doesn't supports it altogether)
[HKEY_CURRENT_USERSoftwareMicrosoftOffice12.0OutlookOptionsCalendar]
"EnableDirectBooking"=dword:00000000
Not sure, reverting back 270 mailboxes and then in future reverting again to final state sounded complicated and could've confused users, registry still looked easier, unless it'll impact users in other ways?