It was nice. And they ditched it for Offline Folders, which was "a folder that syncs, until it breaks all the time".
And in the meantime, here's Joel Spolsky in 2008:
“Imagine all your devices—PCs, and soon Macs and mobile phones—working together to give you anywhere access to the information you care about.” And what is this Windows Live Mesh? It’s a way to synchronize files.
Jeez, we’ve had that forever. When did the first sync web sites start coming out? 1999? There were a million versions. xdrive, mydrive, idrive, youdrive, wealldrive for ice cream. Nobody cared then and nobody cares now, because synchronizing files is just not a killer application. I’m sorry. It seems like it should be. But it’s not. Damn, they just finished building something called Windows Live FolderShare and I haven’t exactly noticed a stampede to that. I’ll bet you’ve never even heard of it. [..] this so called synchronization problem is just not an actual problem, it’s a fun programming exercise that you’re doing because it’s just hard enough to be interesting but not so hard that you can’t figure it out.
https://www.joelonsoftware.com/2008/05/01/architecture-astro...
And now Microsoft is ditching Offline Folders which break a lot, for Work Folders - folders that sync over HTTPS, without a local hidden cache.