We have a web application which uses an SQLite database, normally this is accessed by giving the IIS user permissions to write to the database folder and works correctly.
But when setting up the site in a Virtual Directory instead of a Web Site, the application fails when attempting to connect to the database file. I can only assume this is due permissions somehow not applying or being different on the database folder, as the same error can occur if permissions are not change when doing a standard Web Site install.
The reason for setting up the web app as a Virtual Directory is due to a client request so they could use the hostnameofserver/virtualsite to access, allowing them to run multiple sites on a single server without needing to change any local DNS server settings etc.
The client server, and the server I am testing on is a Server 2003 R2 SP2 (32bit).