A few weeks ago we started noticing an issue with the CamlDesigner and connecting to O365.
An error was generated in the logs and the user got a “your credentials isn’t correct” notification. So after some digging around and creating a clean VM in azure because on our machines the thing worked. We found what the issue was.
Some dll wasn’t found, but not because of CamlDesigner, but Microsoft.SharePoint.Client.Runtime.dll was the one to blame. According to a blog post of Tomasz Rabinski inside this dll there is a relative reference to msoidcliL.dll. And this is the one we were looking for.
But you can only use the CSOM way to connect to the O365. The web service way also returns an authentication error but we are still looking into this one. Expect an update soon.