I've only seen the one original copy on the server via webmail, but each computer re-downloads all of the same emails again (this occurs on 5-6 computers that all check the same address).
I'm simply using outlook 2000 on each computer. Never happens to other email accounts (our personal ones).
Thanks for the replies thusfar, I have contacted dreamhost support about this a while ago but the reply was basically "that's impossible it couldn't possibly be the server".
Unless someone is logging in and marking a bunch of messages as unread (which would be odd seeing as how I'm the only one with the password and webmail address), I don't see any other possible cause.