Almost drove me crazy, this error on my Windows 7 64bit Ultimate, connecting Outlook 2010 with my Windows Mobile 6.5 HTC Touch Diamond 2. From one day to the other synchronization did not work any more because the WMDC process crashed. Un- and re-install did not help.
The solution was to delete all sub keys (partnerships) from the following registry node:
HKEY_CURRENT_USER\Software\Microsoft\Windows CE Services\Partners