The solution was simple. The 'secure' field should be 'secureConnection'. The MEANjs scaffold that generated the configs created mailer options with the 'secure' field. The rest of the options are fine. For anyone that needs a working Office365 SMTP nodemailer options block, the following should work:
{
host: 'smtp.office365.com',
port: '587',
auth: { user: 'xxxx', pass: 'xxxx' },
secureConnection: false,
tls: { ciphers: 'SSLv3' }
}