Jack Wallen admits this solution to an ugly problem isn't pretty, but in the end, your users/client will have offline folders that work in Windows 7.
This problem is an ugly one. I recently had a client whose offline folders in Windows 7 were broken. No matter what I did, offline folders constantly gave the error that another process was accessing the files so syncing could not continue. This was simply not acceptable. Here's how I wound up fixing the issue. (Warning: It's not a pretty fix, and depending upon the amount of client data, it could take quite awhile to complete.)
- Back up all of the user's data on the server. The data to be backed up is the data that is not syncing. Back it all up and place it in a safe location.
- Back up all user data on the client machine. Again, this is the data that is not syncing.
- Delete all of the user's data (again, the data not syncing) off the server. Remember, you have a full backup of this data, so even if something goes completely wrong, you can replace it.
- Copy the backup of the data from the client to the server. Make sure the new data goes exactly where it should go on the server (e.g., Documents or Libraries).
- Delete the data from the client.
- Restart the syncing process by going to Start | Control Panel | Sync Center and clicking the Sync button. The resyncing of the client data should now begin without conflict; if it doesn't, log out and log back in or do a full reboot of the client PC.