While on the installer screen, try running an "iisreset" through a command line, then clicking Next in the installer to rerun the pre-requisites check. I've had to do this a handful of times, and this usually does the trick.

We ran into this when using 64-bit Windows Server 2003.  What we needed to do was go to the IIS Manager (there should be a shortcut to this under Administrative Tools if IIS is installed), drill down to the web server extensions and enable the ASP.NET extension.  Apparently when IIS is installed on 64-bit Windows the ASP.NET extension is prohibited by default.  Hope this helps.

In addition to what JDogg did - I had to do this:

Granted Network Service Modify writes to : 'c:\WINDOWS\Microsoft.NET\Framework64\v2.0.50727\Temporary ASP.NET Files'

Reran check - OK

From Application Event Log :

vent code: 3005

Event message: An unhandled exception has occurred.

Event time: 10/15/2009 9:46:28 PM

Event time (UTC): 10/16/2009 1:46:28 AM

Event ID: bbbc91f783dc44f087bbea0f1619683c

Event sequence: 1

Event occurrence: 1

Event detail code: 0

Application information:

Application domain: /LM/W3SVC/1/Root/testInstallVirtualDir-1-129001311874586843

Trust level:

Application Virtual Path: /testInstallVirtualDir

Application Path: C:\Documents and Settings\jpeters\Local Settings\Temp\1\__Symantec_Workflow_Solution_Setup\testInstallVirtualDir\

Machine name: VIT41

Process information:

Process ID: 2924

Process name: w3wp.exe

Account name: NT AUTHORITY\NETWORK SERVICE

Exception information:

Exception type: HttpException

Exception message: The current identity (NT AUTHORITY\NETWORK SERVICE) does not have write access to 'c:\WINDOWS\Microsoft.NET\Framework64\v2.0.50727\Temporary ASP.NET Files'.

Request information:

Request URL: http://localhost/testInstallVirtualDir/default.aspx

Request path: /testInstallVirtualDir/default.aspx

User host address: 127.0.0.1

User:

Is authenticated: False

Authentication Type:

Thread account name: NT AUTHORITY\NETWORK SERVICE

Thread information:

Thread ID: 1

Thread account name: NT AUTHORITY\NETWORK SERVICE

Is impersonating: False

Stack trace: at System.Web.HttpRuntime.SetUpCodegenDirectory(CompilationSection compilationSection)

at System.Web.HttpRuntime.HostingInit(HostingEnvironmentFlags hostingFlags)

Custom event details:

For more information, see Help and Support Center at http://go.microsoft.com/fwlink/events.asp.

I had the same issue and had to go into C:\WINDOWS\Microsoft.NET\Framework\v2.0.50727 via command line and run aspnet_regiis.exe -i then check and make sure ASP 2.0.50727 is allowed in IIS.

Ran into the same error and after running aspnet_regiis.exe -i from  C:\WINDOWS\Microsoft.NET\Framework\v2.0.50727 via command line as rharveyva suggested , everything validated fine in the installer.

Having the above issue installing SD7 and have attempted suggested resolutions with no success....Help!

Running this on a x64 2003 server. Are we supposed to use the x64 .net installation or the 32 bit? None of the above has helped.