internet links not working in Outlook 2010. "General Failure. The URL Was: http://frustration.com, etc. Application not Found"

Try the steps below and check if it resolves the issue.

Disclaimer: If you use Registry Editor incorrectly, you may cause serious problems that may require you to reinstall your operating system. Microsoft cannot guarantee that you can solve problems that result from using Registry Editor incorrectly. Use Registry Editor at your own risk

Visit the link below for more information on registry back-up:

http://windows.microsoft.com/en-us/windows7/Back-up-the-registry

Click ‘Start’ and type ‘Run’ in the ‘Search programs and files’ box above ‘Start’ and hit ‘Enter’. In the Run window type ‘regedit’ (without quotes) and click ‘Ok’. Now navigate to the following location:

HKEY_CLASSES_ROOT\FirefoxURL\shell\open\ddeexec

At the right pane double click ‘(Default)’ and clear the ‘Value data:’ field and click ‘Ok’.

I have had a problem for a long time where outlook was unable to open hyperlinks -- it would always ask you for what to open it with polluting the registry with a number of strange extensions (from the end of the url).  I dealt with it until a link had .exe on the end (it was an internal download link) which then caused windows to forget what to do with .exe files. 

Citrix had a similar issue and had the magic register key set after resetting the browser associations,...

Copy this to a .reg file and import it to complete the association.

......

Windows Registry Editor Version 5.00

[HKEY_CLASSES_ROOT\htmlfile\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\htmlfile\shell\opennew\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" %1"

[HKEY_CLASSES_ROOT\http\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\https\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\IE.HTTP\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\IE.HTTPS\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\mms\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

"MPlayer2.BAK"=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\pnm\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\rtsp\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"

[HKEY_CLASSES_ROOT\rtspu\shell\open\command]

@=""C:\Program Files\Internet Explorer\iexplore.exe" -nohome"