I have run across this issue, but only when migrating to a new Mac. I tried everything - repair permissions, brand-new Classic, new Outlook install. Finally I had to wipe the Mac, install the OS and Classic, THEN install Outlook and finally copy over user data.
Unfortunately there was no way to keep any Outlook data doing it this way, but at least it was working.
I am about to migrate 7 people to new G5s and this issue is giving me a headache. I'm going to try to use a different partion/volume for Outlook and see how that does....
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