Microsoft has identified a bug in Windows 10 version 1607 and Windows Server 2016 is causing errors to appear in the Group Policy Editor.
Microsoft health report stated Windows 10 1607 and Windows Server 2016 users were experiencing errors when opening the Security Options MMC in Group Policy Editor.
This issue is due to applying September cumulative update KB4577015 and that they are working on a fix.
Accessing the Security Options data view in Group Policy Management Editor (gpedit.msc) or Local Security Policy Editor (secpol.msc) may fail with error MMC a detected an error in a snap-in. It is recommended that you stop and restart MMC “or” MMC cannot initialize snap-in .
This happens from the MMC window, when the console tree is expanded in the following order: select Computer Configuration, then Policies, then Windows Settings, then Security Settings, then Local Policies, then Security Options Microsoft explained.
As a work around uses can install RSAT tool in Windows 10 v1709 and above to bypass the issue for now. Possibly this will get patched in next patch window.