Thanks guys-it must be then that there was some kind of issue in RTM, and as 
Ben said, it was silently failing until SP1 applied.  We're not trying to 
re-enable EFS via GPO at another level (using Computer config\Windows 
settings\security settings\public key policies), so I don't think the article 
applies in this case, but that is good to know about.

From: Free, Bob [mailto:r...@pge.com]
Sent: Wednesday, March 30, 2011 8:08 AM
To: NT System Admin Issues
Subject: RE: Win7 w/SP1 offline sync gives Access Denied

> Question-does anyone know if this encryption is done using EFS?

Yes, it is specified in the EFS documentation that EFS is used for the offline 
file cache. The policy interaction you describe is very interesting. From a 
purely theoretical POV, if I disable EFS at the Domain level, that should be 
it, period.

However there is a rapid publish KB that describes some unexpected behaviors 
with disabling/enabling EFS via policy 
http://support.microsoft.com/kb/960050/EN-US that may be germane to your 
situation.

From: Miller Bonnie L. [mailto:mille...@mukilteo.wednet.edu]
Sent: Wednesday, March 30, 2011 7:26 AM
To: NT System Admin Issues
Subject: RE: Win7 w/SP1 offline sync gives Access Denied

So, shortly before I left yesterday I went through our GPOs that were applying 
to Win7 laptops.  The only one I thought might have anything to do with this 
turned out to be the culprit, but I'm not exactly sure why.  Since we won't be 
calling PSS at this point I may not find the answer to that, but here's what it 
was:

Since we started adding Win7 policies (back in October/November 2010) along 
with many other policies, we enabled the setting for \computer 
configuration\Administrative Templates\Offline Files "Encrypt the Offline Files 
cache".  Yesterday as a test, I changed this to disabled, which decrypts the 
cache.  After after rebooting the machines with the "access denied" errors, 
everything started working again, so I changed it at the domain level and got 
the same results-things are now working "normally" again.

Question-does anyone know if this encryption is done using EFS?  It is not 
specified in the policy description.  We have disabled EFS at the domain level, 
as we don't want kids encrypting their files.  So, it makes sense to me that if 
it uses EFS but it is disabled at the domain, this would cause a potential 
conflict and could cause the "access denied" errors we were seeing.  What I 
don't understand is why the problem only starts after SP1 is applied, unless 
there is a problem with the RTM version applying this policy altogether.

Hopefully today will be a better day...

-Bonnie

From: Miller Bonnie L. [mailto:mille...@mukilteo.wednet.edu]
Sent: Tuesday, March 29, 2011 12:22 PM
To: NT System Admin Issues
Subject: Win7 w/SP1 offline sync gives Access Denied

Anyone else seeing this problem, or successfully syncing their offline files 
using a Win7 SP1 system in a domain?

User logs onto Win7 non-sp1, offline sync of files works fine.  Machine gets 
updated to SP1, same user (no changes) logs onto Win7 with SP1, offline sync 
throws "access denied" errors on all files.  Log off, take the same user 
account (same profile, etc) back to a non-SP1 machine and offline sync works 
fine.

We have quite a few Win7 systems now that have SP1, and are getting the same 
symptoms across multiple machines.  I've tried tons of stuff, including 
changing the back-end server from WS03 R2 to WS08 R2 SP1, taking DFS out of the 
equation, changing paths from DNS names to netbios names to IPs, removing ABE, 
setting ownership to the user, and setting both NTFS and share permissions to 
full control all the way down the tree on the server to "Everyone".  As best I 
can tell, this is a client-side issue, but I'm not sure what else to look at.  
There are a few policies that control offline file behavior, and although 
nothing has changed from our non-sp1 setup, I'm happy to change something if it 
would help.

We're about to open a PSS call, but I'm fishing for other ideas as well.  
Searching around, I'm just not seeing other people reporting this problem.

Thanks,
-Bonnie

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