I use offline folders in Vista to sync a set of folders located on my server so I can use the files when I'm not connected to my network. What's great is that these folders are part of a nightly backup plan so I don't have to worry about backing them from my laptop.
However, if the computer you sync with is no longer available, you can't delete or change the sync partnership because Vista requires that both sides are up and running. Dead end? No, because you can delete ALL sync partnerships using a registry change.
WARNING: This will delete ALL sync partnerships so be careful because you may delete files forever, bring deadly plagues to the earth, render your dog blind, get your hair on fire, etc. Don't do this unless you backup your sync folders, send flowers to your mother, give to United Way and learn to dance the salsa. You've been warned!
From KB article 934160
To work around this issue, add the FormatDatabase registry entry to the following registry subkey:
HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\Csc\Parameters
Then, set the FormatDatabase registry entry to 1.
To do this, follow these steps:
| 1. |
Click Start , type regedit in the Start Search box, and then click regedit in the Programs list.
 If you are prompted for an administrator password or confirmation, type your password or click Continue. |
| 2. |
Locate and then click the following registry subkey:
HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\Csc\Parameters Note If the Parameters subkey does not exist, create it. To do this, follow these steps:
| a. |
Click the following registry subkey:
HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\Csc |
| b. |
On the Edit menu, point to New, and then click Key. |
| c. |
Type Parameters, and then press ENTER. | |
| 3. |
On the Edit menu, point to New, and then click DWORD Value. |
| 4. |
Type FormatDatabase, and then press ENTER. |
| 5. |
On the Edit menu, click Modify. |
| 6. |
Type 1 in the Value data box, and then click OK. |
| 7. |
Exit Registry Editor, and then restart the computer. |
Credit: for the answer here
After doing this I found another way to delete or rename cached folders while working offline via a Windows hotfix.