I was finally successful in creating a parent portal using DNN 4.3.3. However, here is how I did it.

First I created a new directory and set up the proper permissions for ASPNET (I am using Win XP Pro).

Next I extracted the full source from the DNN 4.3.3 zip file (DotNetNuke_4.3.3_Source.zip) into the new directory.

I created a new virtual directory and pointed to my new DNN directory.

I then created a new DNN database, copied release.config and renamed it web.config, and set up the proper connection strings.

I accessed the new web site and DNN installed.

I then logged on as host and created another portal with no problems.

The bottom line is I did a complete fresh install to a completely new instance of DNN before I was able to get the new portal function to work. The problem of course is with the old portals. How do you get them over to a new instance of DNN? There are a lot of database row entries that would need to be transferred. It is almost like an ETL process for a data warehouse! The only other option is to get the update process fixed. I don’t have enough expertise with DNN to do that in any reasonable time frame.   

Note I have not tried a child portal yet. However, it is pretty obvious that there is some problem with the upgrade process. When I upgrade the source version of DNN I save the web.config file, extract the new source over the old directories, and then copy release.config and name it web.config. I then change the connection strings and the Machine Validation and Decryption keys in web.config. That has worked for me up until now. Does anyone know what the upgrade problem could be? Is my procedure now incorrect?