I have Google Calendar and Outlook 2007 syncing without any trouble. Are you running Google Calendar Sync? Personally I only sync one way Outlook to Google but it can be set up to sync both ways. As far as I am aware you do not get the internet calendar in the nav pane. It adds and deletes to the standard Outlook calendar. I use it to sync with my android phone. I enter a new appointment in Outlook and a few moments later the Google Calendar is updated and my phone. I found that it didn't work so well in reverse.
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