I am having the exact same problem. I have tried EVERYTHING. Nothing is working. This has happened before and Apple eventually fixed it with an update. It's unfortunate that their premature release of an update results in our endless irritation trying to remedy our malfunctioning software. Especially when they tell us to do all sorts of troubleshooting, ultimately in vain. I filed a report with Apple, online. Please fix this Apple. This is on your end. Thanks.
By the way jamesfrancis, I'm not sure what you're referring to about the sync services folder...? i have a windows 7 pc and I can't find that anywhere. Thanks!