Its one of the more annoying "security" changes that Microsoft ever introduced.  Lost a lot of time and effort when I first installed win 7 trying to sort that one out.

Once you understand how it works though it does make sense in terms of cross user authentication security.  The other option if you don't want to use the Network Service account is to create your own separate user account for the application pool - which we do on some larger systems - which plesk does on its managed platforms - but if you go down this path then you also need to make sure the user is assign full rights to the asp.net temp folder.

Westa