There seems to be an ongoing chaotic series of bugs, or bug, around "Set as Default Browser" and FireFox. Recently I updated my FireFox to 2.0.0.3 and suddenly whenever I click on a URL in Outlook I get a message box with "General Failure." Occasionally I'll get a "Locate Link Browser" message as well.
The issue seems to be some of the old Windows DDE stuff where a DDE message is sent to an application after it started up to pass information - in this case, the URL. Today, we prefer to pass the URL on the command line. It also makes for a faster launch.
Even though this was a problem with FireFox 0.9, it's still happening today. (I'm not the only one). John Haller has a fix in the form of a Registry File.
You can also make the change yourself in the Explorer UI via Tools|Options|FileTypes. Go to the ones marked (NONE) and start with URL:HyperText...and go to Advanced, then Edit the Open action and clear out the DDE Message TextBox.
Unrelated Aside: John's even got a theme and tools and hacks to make FireFox 2 look like IE. Stunning.
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