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As you can see I had a problem with SkyDrive. My account had 5GB+ of files and they were impossible to access from the web. Luckily the Windows tray application that syncs files between machines continued to work. However, NOTHING else did. OneNote on Android, SkyDrive app from the Windows 8 store, SkyDrive on Android, any 3rd party app that needed authentication... all broken.
Through the mind numbing process of elimination I found a jpg file causing the issue. If the file is anywhere inside SkyDrive folder, even buried in the folder tree, the error happens. When the rouge file is removed from SkyDrive everything goes back to working as expected.
Through a not quite as tedious process of elimination I narrowed down the jpg file's issue to the EXIF data; specifically the XP Comment field.
It looked like this:
That's big ass weird comment field. Not sure how it got that way. I took the picture with my Android device like many hundred other pictures in my SkyDrive.
After changing the comment to this:
Skydrive goes back to working perfectly.
Skydrive Web, OneNote, Android syncing apps, everything is working as expected.
I hope this helps others in their efforts to solve the same problem.