I often find there are potentially two issues when it comes to Error 000117.
1) Have you tried changing the output directory and ensure there are no spaces in the name / path (and the start of the output filename isnt a number); and
2) have you tried running the repair geometry tool on the data?
Something else, maybe try creating a new field and populating that with the parameter for the dissolve and re-run the dissolve on that field?
Hope this helps a little.