Error when using RUU

[B-4]

Hello
HTC Diamond (Telus) (brand new)
It would seem that every time i use RUU i get an error msg ERROR (224): Device not responding.
I've tried several soft reboots to the PPC and reboots to the PC re-plugged usb cables, used other cable... nothing has remedied the issue.
I've also noticed whenever i Active Sync it, it can't sync with MS Outlook 2007 but I'm able to access or Explore the device.
OS Windows xp pro sp3

If anyone can shed some light on this issue... Thank you
Max