Unable to open attachments in Outlook 2013

Environment:
This is on a corporate network, the email is hosted with Office365 Exchange. Accessed from a Windows 7 Pro PC. Everything works fine with the online portal. The problems appear to only be with Outlook 2013. We have about 10 or so PCs running the exact same configuration within this same network segment. It is filtered with a Watchguard XTM510. The SSL traffic is straight through without proxy or blocking.

Lync also installed and ran via Lync server online.

Currently Offline settings are to user cached exchange mode, and set to keep 1 month offline.

Issue:
When trying to open attachments within Outlook 2013, it fails.

Symptoms:
Will close and re-open Outlook. On first opening, the email it will bring up the preview. From the preview, if I right-click on the attachment and choose open (or double-click), it will then hesitate and display the following in the bottom right icon pop-up:

Cannot save the attachment. Cannot write to file:
 C:\Users\user\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.... Right-click the folder
that contains the file you want to write to, and then click Properties on the shortcut menu to check your
permissions for the folder. We can't complete this because we can't contact the server right now.
Please try again later.

Open in new window


In the event log, right after the first mentioned error as listed above there is also 2 informational events. Both are event 26, with different descriptions:

Connection to Microsoft Exchange has been lost. Outlook will restore the connection when possible.
Connection to Microsoft Exchange has been restored.

After this, you can attempt to open the attachment again, and we receive a modal dialog stating "The operation failed" with an exclamation point.

Also, it sometimes will show in a popup from the toolbar icon, the following message: "Microsoft Outlook, Outlook is trying to retrieve data from  the Microsoft Exchange server outlook.office365.com"


Oddities and Inconsistencies:
Some attachments open! I have a JPG file by itself which opens no problem. On another email there is a PDF by itself which fails. One email has 3 attachments,
Online Budget Entry Tool.docx
Will not open
Departmental Budget Request Fiscal Year 2015.docx
Opens
budget instructions 2015.doc.docx
Opens

Attempts to fix
- Disabled synchronization of Lync with Outlook.
- Checked the folder in question that all subfolders had required permissions for writing.
- Ran OffCAT 1.2, it mentioned a possible problem with attachments in regards to docm, I launched dcomcnfg and went to properties within Component Services>Computers>My Computer. After that, I went to default properties and unchecked "Enable COM Internet Services on this computer" and changed the Default Authentication Level to "Connect" and changed Default Impersonation Level to "Identify". I left "Enable Distributed COM on this computer" checked.
- Tried disabling Outlook cached exchange mode.
LVL 1
multiplex79Asked:
Who is Participating?
 
Vasil Michev (MVP)Commented:
Seems more like an issue caused by too much restrictions imposed on the machines, either via GPO or scanning software/add-ins. Run Outlook in safe mode, either by holding the CTRL key when launching it or by typing 'Outlook /safe' in the run box, and see if that makes a difference. In addition, temporary disable any AV or other scanning software.

Check also the settings under File -> Options -> Trust Center -> Trust Center settings -> Attachment handling
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