In my XP when you go to Tools > Folder Options in Windows Explorer, I see "Synchonise" as an option in that menu, not in the Folder Options dialog. And like you, I don't see any "Offline Files" tab in Folder Options.
If I then click that Synchronise option I get the same window you do, and I see the "Setup" button at the bottom.
If you click that, can you step through the tabs and options to see if there is anything you can stop/halt/delete or untick? Don't forget to try any "Advanced" buttons you see in that new window.
I noticed where you said you installed "MS Windows syncronisation", but when Googled that term I didn't see any options to 'install'. How did you do that?
I did find this link in that Google search; http://support.microsoft.com/kb/307853 about "How to use offline files in Windows XP" and it talks about this same "Offline Files" tab in Folder Options, which neither of us have.
However, when I scrolled down that page I saw Troubleshooting which talks about disabling "Fast user switching". It says;
"You cannot use offline files.
This can occur if the Fast User Switching feature is enabled. You cannot use fast user switching when you use offline files. To disable the Fast User Switching feature:"
and carries on to give instructions for turning Fast User Switching off.
I wonder if this missing tab is because you have Fast User Switching enabled.
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