It is official we are not the only folks that got this issue - check out
http://www.geekzone.co.nz/juha/3253 this guys sees things exactly as I see them. I have beena ble to digg out more stuff here. The issue goes back to two .DLL files. They are the followings:
A) Outlooksyncclient.dll
B) Ituneoutlookaddin.dll
You can go to Outlook and check this out:
Tools>Trust Center>Add Ins ....
Checkout the list that comes out as the result. You will see that iTune has added two files at two different locations just about the same time .. but the main error message called out by Geekzone post is pointing to file "A" in my list. By now I have reinstalled Outlook 2007, iTune 7.3 multiple times and no result. So, I can say this - those that have tried this and got it working for them - must have been darn lucky - as this software seems really bugy to me and still cannot get any responce from apple on this. Will post more as I learn more.
DB