Accidentally discovered this earlier.

With internet connected: launcher starts almost instantly

Without internet connected: nothing happens for ~15 seconds, then an error message is displayed ("Outcast 1.1 has stopped working")

The game itself can still be launched by running "OC1.1.exe" in the install folder - however, this starts a new game, which requires you to skip or sit through the first in-game cutscene before you can load a save.

It crashes on my gaming machine with or without internet connection, if I try to start it with the Launcher. Unfortuately, there's no way to configure the game when I start it with "OC1.1.exe", but it's relatively simple to change the settings manually in the "outcast.ini". I really hope these issues will be fixed.

My copy of Outcast runs just fine. 2.7GHz dual core CPU, 4GB RAM, 512MB GPU, Windows 7.
There's a bit of screen flicker as the opening cinematic goes from Windows Media Player to the in-game graphics, but that's a minor gripe. I also like that you can re-map the controls and even set it for Direct Input (Logitech/generic/PS3) and Xinput (360) controllers.

Like Wolfram I'm getting this crash no matter whether I'm connected or not. I also deactivated my firewall for a few minutes, just to make sure, and I'm still getting that crash.

Also tried compatibility modes and stuff, nothing seems to help. Running Windows 7 x64 here.

The game runs just fine when I directly launch OC1.1.exe, though (with a few minor issues which I will post about in other threads).

Edit: Okay, the crash seems to be actually related to video codec stuff. Read more about it here. I guess the reason that you get a crash when you're offline is actually related to Windows Media Player or something (which may be refusing to play video for a moment if it can't instantly connect, I guess).