I have this same problem with Outlook 2013 in Windows 8.
In Outlook Add-in for iCloud, "Wrong Password" replaces the "Refresh" ribbon icon.
Calendar events are not synced to my iPhone.
Refer to screenshot below.
Once I Run as Administrator the Outlook 2013 program, the Calendar events are sync to my iPhone Calendar app.
But I don't want to be doing this for 2 reasons:
1. security implications of running your email as Administrator.
2. searching of emails in Outlook is limited, apparently due to indexing disabled.
Screenshot of functioning iCloud Calendar Add-in to Outlook 2013.
I didn't used to have this problem.
I'm not sure what update created this issue.