Hopefully this helps others in an enterprise setting looking for a solution. My solution after much tinkering was the following:
Follow the steps in the following link to install legacy browser extension and gpo settings:
https://support.google.com/chrome/a/answer/3019558?hl=en&ref_topic=3062034Enabled legacy browser redirect for "file://" through chrome gpo configuration Google Chrome -> Legacy Browser Support -> "Websites to open in alternative browser"
Configure gpo to also install extension:
https://chrome.google.com/webstore/detail/enable-local-file-links/nikfmfgobenbhmocjaaboihbeocackld that redirects file:// links to bypass chrome file:// link block.
The extension opens the links which then triggers google chrome to open the link in internet explorer. The result is IE opens a window, then opens the file/folder for the user, then IE closes itself.