It's interesting to note (and somewhat frustrating) that Windows Live works better in the USA than elsewhere. I'm about to head home from Seattle and have just used Live to work out my route to the airport via a store and then the Microsoft Campus. I noticed a button "Show Traffic Information" in the "Driving Directions" panel.

The following image shows you the output for my journey - you can clearly see that the I-5 (freeway) is clear as it's denoted green. I tried a similar journey for London and while the "Show Traffic Information" button is present it doesn't have any effect ;-( Does it work where you are? If so and you're outside North America then please let me know via a comment.

My next task is to "make a friend" in the Live team and find out more...