I have an existing .Net application on Server A to which I would like to add a child virtual directory (converted to an application) running Kentico. This seems to work fine when the virtual directory is pointing to an instance of Kentico on the same machine, using IIS7.

From Server A, if I point the virtual directory to an instance of Kentico running on a separate machine, Server B, I get HTTP Error 500.19: Error Code - 0x80070005; Config Error - Cannot read configuration file due to insufficient permissions. This is reported on the root Kentico web.config. I have set the "connect as" for the virtual directory to an account I am sure has sufficient permissions.

Note: server A is running IIS7 and Server B is IIS 6. I am using Classic .Net app pools

Any ideas on whether this is an IIS version compatibility issue or possibly something else?