We have one large library (~10 GB) on SharePoint that cannot be synchronized with Outlook, even if you only attempt to synch one of the smaller sub folders in the library. Other libraries (or other library sub folders) work fine with Outlook.
This is with MOSS 2007 SP1 and Outlook 2007 SP2.
The error is:
Task 'SharePoint' reported error (0x80004005): 'An error occurred either in Outlook or SharePoint. Contact the SharePoint site administrator.'
Reproducing the error
Update 1: I verified the same issue occurs on Windows XP SP3 with IE 6 using Outlook 2007 SP2 and the same SharePoint library (it was originally tested on Windows 7). The issue is definitely related to the library or Outlook.
Update 2: Using stsadm I exported the site with this large document library (8.6 GB 15,000 items) and imported it on to a development system. The result is the same on the development system - multiple clients are unable to connect Outlook to the library and get the 0x80004005 error above.
From other posts it looks like this could be a System.Runtime.InteropServices.COMException on your server.
For other scenarios the same error message has been fixed in a windows update. You could check that windows update has been run on your PC / SharePoint Server and Exchange Server.
Or it could simply be a bug.
I had also once curious troubles with Office and Sharepoint. My error was unexpected in Word.
I whould try Office Diagnostics Diagnose and repair crashing Office programs by using Office Diagnostics just to be sure there is nothing wrong with the installation.
I have been troubleshooting this issue with Microsoft, and we have found the root cause of the error in Outlook. The error is caused by trying to synchronize folders that have two dashes ("--") in the folder name or folder path (other special characters may cause the same error.) The problem is unrelated to the size of the library or the number of items.
The fix is to rename folders that contain two or more dashes in a row. Files with two dashes are not an issue.