SharePoint Workflow URL Encoding %2520

My company too was encountering this problem when opening Word / Excel / PowerPoint files from SharePoint sites or OneDrive using the "File - Open" and clicking on an item in the "Recent Documents" list. 

We have been planning to roll-out Semi-Annual 1803 build 16.0.9126.2259 then because of other issues moved forward to 16.0.9126.2282.  All other issues aside the one I was working on was with Microsoft OneDrive files where the filename or pathname contains a space.   This issue continued to exists when I install the Monthly Targeted build of 16.0.10730.20102

When you hover over the link of the ONE DRIVE file to be opened it shows the URL path correctly with only the %20 in place of the space in the https:// path.
https://<companyname>-my.sharepoint.com/personal/<useraccount>/Documents/Test%20Folder/Test%20Document.docx

 When you right click on the file and choose “Copy Path to Clipboard” - you actually get a WRONG URL: This is the URL that copied:

https://<companyname>-my.sharepoint.com/personal/<useraccount>/Documents/Test%2520Folder/Test%2520Document.docx?web=1

Note that the name has a %20 which is a space in the path.  In the copied URL it has %2520.  %25 translates to ASCII HEX 25 translates to DEC 37 which is the ASCII for “%”.  Thus the path is %20 but not really.  It is %25 representing “%” followed by 20 to create %20 = space character. If I remove the 25 so that it is only %20 then the link works.  This is a result of "Double-Encoding".   BOTTOM LINE: OFFICE for WORD / EXCEL / POWERPOINT is creating URLs that contain a wrong character and the URL is wrong.  This is not information provided by OneDrive or SharePoint it is a URL generated by the MS Office application.

After working with a SharePoint / OneDrive Microsoft support person this was escalated to a "Special Team" that supports Office 365 but is made up of employees that also seem to have ties to the SharePoint / OneDrive team in their past.
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The ANSWER IS:

As we discussed, this issue is being caused by the use of the RoamingSettingsDisabled key in Office.

[HKEY_CURRENT_USER\Software\Policies\Microsoft\Office\16.0\Common\Roaming]
"RoamingSettingsDisabled"=Dword:0x00000001

This is a now-unsupported key in Office C2R, and the behavior you're experiencing is a result of a product bug that the developers have elected not to fix due to the deprecation of that key's use.

The key can be remove/changed to "0" via GPO, as it's part of the Common Office 2016 policies.

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The GPO setting is available in the current .ADMX file.  Those deploying the newer versions of the "Semi-Annual" builds of Office 365 are just seeing this because of the incorporation into the Semi-Annual code.  Those that use the Monthly Targeted builds should have already been seeing this for possibly up to 5 months. 

I hope this helps since I was not able to find this information any places else as was VERY lucky to have directed to the right support team within Microsoft.  It was with-in two minutes of saying "HELLO" that he was able to provide the solution.