I found this thread while searching for any information about the "The Operation Failed" error that I was getting when attempting to send an email attachment via Outlook 2003 using the Send To... Mail Recipient function in Windows Explorer.
Several people here have identified this error with totally different causes in a variety of situations. Clearly the error message is totally useless since it does not provide any specific information (not even one of MS's cryptic error codes).
In my case, it doesn't matter wether Outlook is open or not. Starting from Windows Explorer, I select one or more files (total around 1 MB), right click, and choose Send To Mail Recipient. Up until earlier this week, this would open Outlook (if not already open) and create a new email message with the files attached, ready for me to add the addresses and change the subject line from "Emailing: xxx" to something more useful. Suddenly this process started giving me the "The Operation Failed" error message almost every time. If the files being attached are pictures, I get the size dialog box first, THEN the error message as soon as I click Attach. If the files are not pictures, I get the error message as soon as I click Send To Mail Recipient.
The mailbox has exactly 3 Messages (totalling about 3 MB) in the Sent Items folder and all the other folders are empty.
If I open Outlook myself, create a new email myself, then drag-&-drop the files to attach everything works as it should.
I am running Office 2003 under Windows 7. This configuration has worked for nearly two years. I suspect that the last Windows Update is somehow responsible (that is the only thing that has changed on this machine)