Then when I tried to send an email or delete an email I got, "... outlook.ost. could not be accessed."
When I look at the directory where it the ost file was everything looked fine. Permission looked fine.
Disable cache: control panel->mail->email accounts->next->change->more settings->advanced tab-> then uncheck "Use Cahced Exchange Mode" and click OK->Next->Finish->Close. You may have to restart Outlook for the change to work.
Disabling the cache seemed to work for me. One side-effect is that it somehow changed my caching in IE8. I didn't have time to research it any further, but will follow-up with an explanation as to why this happened and why I wasn't able to access the .ost file in the first place.