I also followed your advice and moved my scratch and current directories to just beyond C:\ (I had them in a Dropbox folder), but that did nothing. There are also no spaces in the paths. I have no extensions installed, and deactivated all extensions but Spatial Analyst, still no improvement. I'm digging into the Windows Event Viewer, but so far I don't think there's anything there. I have also looked at the log files in the ArcToolbox/History directory, they provide no information. Is there perhaps a log file I'm missing? Something for ArcMap in general beyond just the geoprocessing logs?