Here is that path I took to get it all working:
1. Install the MS CRM add-in for Outlook.
2. Search long and hard for the location of the latest add-in update.
3. Try to connect.
The key point of this message is that the add-in can’t find a DLL. After some searching, it looks like the DLL belongs to Windows Identity Foundation.
Naturally, the next step was to try installing Windows Identity Foundation, which failed miserably with the following error:
4. Turn on the Windows Identity Foundation feature. (Under control panel, Program & Features > Add windows features)
5. Reinstall the latest MS CRM Patch.
6. Connect to CRM.