Windows 7 SCCM 2012 R2 clients unable to download content

This is a case where Windows 7 x86 non domain workstations with SCCM 2012 R2 client installed were unable to download content from SCCM server. Network Access Account was properly configured, and the client was using it but was still unable to download content. Anonymous clients were not allowed to connect to distribution point. Here are the error messages from DataTransferService.log:

<![LOG[Job {...} impersonating Network Access Account.]LOG]!>
<![LOG[[CCMHTTP] ERROR: URL=http://servername:80/SMS_DP_SMSPKG$/PackageID, Port=80, Options=224, Code=0, Text=CCM_E_BAD_HTTP_STATUS_CODE]LOG]!>
<![LOG[Error sending DAV request. HTTP code 401, status 'Unauthorized']LOG]!>
<![LOG[GetDirectoryList_HTTP('http://servername:80/SMS_DP_SMSPKG$/PackageID') failed with code 0x80070005.]LOG]!>

After installing the following hotfix KB2522623, this client has successfully downloaded and installed packages. This hotfix is applicable to Windows Server 2008 R2 SP1 also, so this kind of behavior should be expected for those server 2008 R2 SP1 clients that are members of workgroup or DMZ.

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