If you receive an error message in Outlook 2010 about saving file the fix is pretty simple.
“Cannot create file: photo.JPG. Right-click the folder you want to create the file in, and then click Properties on teh shortcut menu to check your permissions for the folder.”
What happened is the temp folder for Outlook is missing or corrupt. The fix is:
Go to the C: drive and create a folder named temp0
Run regedit, browse to the location HKEY_CURRENT_USERSoftwareMicrosoftOffice14.0OutlookSecurity and enter the key below.
Reboot the PC and you’re all fixed up!