Sometimes users see “enable offline files” option greyed out in the Offline Files tab. This happens when the group policy is set to disable offline files. This locks the offline files UI and users will not be able to change any setting. You might have to contact the administrator of the computer domain to get the the group policy modified to enable offline files.
I have this issue on a Thinkpad Z61t running XP Pro. The group policy is "Enabled" for offline folders. So are all NetCache registry keys. Still the tab is grey.
Did you check if Fast user switching is enabled on the machine?