Running the sysprep command on a VM before Capture
sysprep.exe /oobe /generalize /mode:vm /shutdown
Produced the error :
Sysprep was not able to validate your Windows installation. Review the log file at %windir%\system32\Sysprep\panther\setupact.log for details. After resolving the issue use Sysprep to validate your installation again.
Looking at setupact.log after fixing the security permissions on the file showed
Error SYSPRP Package Microsoft.OneDriveSync_22186.904.1.0_neutral__8wekyb3d8bbwe was installed for a user, but not provisioned for all users. This package will not function properly in the sysprep image.
Error SYSPRP Failed to remove apps for the current user: 0x80073cf2.
Run this
Remove-AppxPackage -Package ‘Microsoft.OneDriveSync_22186.904.1.0_neutral__8wekyb3d8bbwe’ -AllUsers
Try again , I had another Package to remove : Microsoft.OneDriveSync_22207.1002.3.0_neutral__8wekyb3d8bbwe
Then I was able to Sysprep