Cannot start or manage offline files - Windows 7

Having a very unusual issue
Brand new build - Acer Aspire system. Had Windows Home premium then an Anytime upgrade done to windows 7 professional. Standard applications are installed on this system, nothing too much 'out of the ordinary'
However the issue is that we cannot get the offline files service to start. The service is present, but we cannot start it with the service simply reporting back 'cannot find the file specified'
Log Name:      System
 Source:        Service Control Manager
 Date:          7/09/2012 1:22:36 PM
 Event ID:      7023
 Task Category: None
 Level:         Error
 Keywords:      Classic
 User:          N/A
 Computer:      Laptop50.gpds.local
 The Offline Files service terminated with the following error:
The system cannot find the path specified.
 Event Xml:
 <Event xmlns="">
     <Provider Name="Service Control Manager" Guid="{555908d1-a6d7-4695-8e1e-26931d2012f4}" EventSourceName="Service Control Manager" />
     <EventID Qualifiers="49152">7023</EventID>
     <TimeCreated SystemTime="2012-09-07T05:22:36.317090300Z" />
     <Correlation />
     <Execution ProcessID="600" ThreadID="916" />
     <Security />
     <Data Name="param1">Offline Files</Data>
     <Data Name="param2">%%3</Data>

I can confirm that the csc dll file is under %systemroot%\windows\system32 and the csc sys file is present under drivers - however I cannot start the service. I have tried rebuilding the CSC cache but to no avail. SFC / scannow finds no errors and I have tried a dll from a different (known working) machine - though the file version is still reporting the same
This is a 64 bit SP1 install

Starting the service from services.msc does not work - neither does the command line prompts.
Trying to manage offline files from sync center shows all the options as grayed out
Who is Participating?
HeronTechConnect With a Mentor Author Commented:
I can confirm that local group policy on this machine does not disable offline files either
"Disable offline files" is even greyed out?
HeronTechAuthor Commented:
Yes - in the local sync centre the options to enable / disable offline files is grayed out
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HeronTechAuthor Commented:
Screeshots of issue
HeronTech--The Offline Files service is dependent on the Remote Procedures Call service.  Has that started?

Your Offline Files cache database may be corrupted.
HeronTechAuthor Commented:
RPC is started - resetting the offlline cache has already been done, and it wouldnt be corrupted as the service has never been able to start
I know the anytime upgrade is probably the issue here however I'm lost as to why and can't seem to recreate it on my own.  I find a lot of accounts of others having the same issue after the anytime upgrade.  This may be an exercise in futility but can you tell me a summary of your install process?  Started with 7 home premium, service pack 1 or pre-sp?  All windows updates done and then anytime upgrade was done or was the upgrade done then windows updates downloaded?

Was this system running home premium for a while or was it a fresh load of home premium, apps, and then upgraded to professional?
HeronTech, the more I test the more I am starting to lean towards a permissions issue.  Will you try something for me? Your paths may vary but here's what I'm up to.  C:\Windows\CSC, rename or move any folders in that folder.  You may have to give yourself permissions to the folders before you can do so.  Reboot and then attempt to start offline files.  Tell me what happens.
HeronTechAuthor Commented:
Found out that the default domain policy was disabling group policy - although the local security policy for this machine wasnt. The user was logging on as a local user AFTER they were initially connected to the domain, so the settings still applied.
Got the same issue on Windows 10 Pro, service wouldn't start up. Tried re-initialize the cache per Microsoft -

Per Microsoft, you can force Windows to clear the cache via a Registry setting.
1.Open Regedit
2.Create an entry in HKEY_LOCAL_MACHINESOFTWAREMicrosoftWindowsCurrentVersionNetCache:
 Key Name: FormatDatabase
 Key Type: DWORD
 Key Value: 1
3.Reboot the PC

Still not working. Any ideas?
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