This update: http://support.microsoft.com/kb/969695 which is the July Office Communicator 2007 R2 update is breaking the GAL download at one of our clients.
Removing/uninstalling the MSP allows the MOC to download the address book files.
Symptoms: Cannot download address book - Cannot synchronize the Address Book.
In the user profile %username%\local settings\application settings\microsoft\communicator\sipuri the galcontacts.db never showed up, but we did get a file called endpointconfiguration.cache…
Many thanks to JMartin and MRovang for their patience while we resolved this issue.