The basic Hotmail service is web-based only; you have to subscribe (pay) for the feature that lets you access your mail via a POP3 client program. There are a few ""workarounds" to that, but I haven't tried them. More info here:
Your ISP should have given you an email account (which would probably be accessible through webmail and POP) when you set up your service with them; why can't you just use that? After all, you're already paying them for the service, right?
The advantages to non-webmail accounts (POP and IMAP) are basically that your messages are stored locally on your computer as opposed to being stored on your email provider's servers, and that you can take advantage of the features of email client programs such as Outlook, Thunderbird, Eudora, etc.
The downside to POP/IMAP-only accounts, of course, is that if you want to check your mail on others computers, you'll have to set up a new account for yourself in the email client program on every computer from which you want to check your mail. Aside from the inconvenience of that, there are obvious security/privacy risks involved as well.