Outlook unable to synchronize SharePoint library - error 0x80004005

SOLUTION

I have been troubleshooting this issue with Microsoft, and we have found the root cause of the error in Outlook. The error is caused by trying to synchronize folders that have two dashes ("--") in the folder name or folder path (other special characters may cause the same error.) The problem is unrelated to the size of the library or the number of items.

The fix is to rename folders that contain two or more dashes in a row. Files with two dashes are not an issue.