It is certain that the authentication is the issue. Please note that the machine is a Windows 7 machine and is on a domain.
We have also double checked that the app pool uses the app pool identity and not LOCALSERVICE etc. We use a SQL Server on another machine and it uses the sa account at this time which is absolutely powerful.
Please see the following extract from Failed Trace. I have also dumped the trace preceding the Warning.
ModuleName ManagedPipelineHandler
Notification 128
HttpStatus 401
HttpReason Unauthorized
HttpSubStatus 0
ErrorCode 0
ConfigExceptionInfo
Notification EXECUTE_REQUEST_HANDLER
ErrorCode The operation completed successfully. (0x0)
35. AspNetPipelineEnter Data1="DotNetNuke.HttpModules.Services.ServicesModule" 10:14:06.910
36. AspNetPipelineLeave Data1="DotNetNuke.HttpModules.Services.ServicesModule" 10:14:06.910
37. NOTIFY_MODULE_END ModuleName="Services", Notification="BEGIN_REQUEST", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
38. NOTIFY_MODULE_START ModuleName="IsapiFilterModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotification="false" 10:14:06.910
39. NOTIFY_MODULE_END ModuleName="IsapiFilterModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
40. NOTIFY_MODULE_START ModuleName="BasicAuthenticationModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotification="false" 10:14:06.910
41. i AUTH_START AuthTypeSupported="Basic" 10:14:06.910
42. i AUTH_END 10:14:06.910
43. NOTIFY_MODULE_END ModuleName="BasicAuthenticationModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
44. NOTIFY_MODULE_START ModuleName="WindowsAuthenticationModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotification="false" 10:14:06.910
45. i AUTH_START AuthTypeSupported="NT" 10:14:06.910
46. i AUTH_END 10:14:06.910
47. NOTIFY_MODULE_END ModuleName="WindowsAuthenticationModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
48. NOTIFY_MODULE_START ModuleName="AnonymousAuthenticationModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotification="false" 10:14:06.910
49. i AUTH_START AuthTypeSupported="Anonymous" 10:14:06.910
50. i AUTH_REQUEST_AUTH_TYPE RequestAuthType="Anonymous" 10:14:06.910
51. i AUTH_SUCCEEDED AuthType="NT", NTLMUsed="false", RemoteUserName="", AuthUserName="", TokenImpersonationLevel="ImpersonationImpersonate" 10:14:06.910
52. i USER_SET AuthType="", UserName="", SupportsIsInRole="true" 10:14:06.910
53. i AUTH_END 10:14:06.910
54. NOTIFY_MODULE_END ModuleName="AnonymousAuthenticationModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
55. NOTIFY_MODULE_START ModuleName="IsapiFilterModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotification="true" 10:14:06.910
56. i FILTER_AUTH_COMPLETE_START 10:14:06.910
57. i FILTER_AUTH_COMPLETE_END 10:14:06.910
58. NOTIFY_MODULE_END ModuleName="IsapiFilterModule", Notification="AUTHENTICATE_REQUEST", fIsPostNotificationEvent="true", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
59. i FILE_CACHE_ACCESS_START FileName="D:\DNN\DesktopModules\internalservices\API\controlbar\ToggleUserMode", UserName="IUSR", DomainName="NT AUTHORITY" 10:14:06.910
60. i FILE_CACHE_ACCESS_END Successful="false", FileFromCache="false", FileAddedToCache="false", FileDirmoned="true", LastModCheckErrorIgnored="true", ErrorCode="The system cannot find the path specified.
(0x80070003)", LastModifiedTime="" 10:14:06.910
61. NOTIFY_MODULE_START ModuleName="HttpCacheModule", Notification="RESOLVE_REQUEST_CACHE", fIsPostNotification="false" 10:14:06.910
62. i OUTPUT_CACHE_LOOKUP_START 10:14:06.910
63. i OUTPUT_CACHE_LOOKUP_END Result="NOT_FOUND" 10:14:06.910
64. NOTIFY_MODULE_END ModuleName="HttpCacheModule", Notification="RESOLVE_REQUEST_CACHE", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
65. NOTIFY_MODULE_START ModuleName="UrlRoutingModule-4.0", Notification="RESOLVE_REQUEST_CACHE", fIsPostNotification="true" 10:14:06.910
66. AspNetPipelineEnter Data1="System.Web.Routing.UrlRoutingModule" 10:14:06.910
67. AspNetPipelineLeave Data1="System.Web.Routing.UrlRoutingModule" 10:14:06.910
68. NOTIFY_MODULE_END ModuleName="UrlRoutingModule-4.0", Notification="RESOLVE_REQUEST_CACHE", fIsPostNotificationEvent="true", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
69. NOTIFY_MODULE_START ModuleName="StaticCompressionModule", Notification="MAP_REQUEST_HANDLER", fIsPostNotification="false" 10:14:06.910
70. NOTIFY_MODULE_END ModuleName="StaticCompressionModule", Notification="MAP_REQUEST_HANDLER", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
71. NOTIFY_MODULE_START ModuleName="ManagedPipelineHandler", Notification="MAP_REQUEST_HANDLER", fIsPostNotification="false" 10:14:06.910
72. AspNetMapHandlerEnter 10:14:06.910
73. i HANDLER_CHANGED OldHandlerName="StaticFile", NewHandlerName="System.Web.Http.WebHost.HttpControllerHandler", NewHandlerModules="ManagedPipelineHandler", NewHandlerScriptProcessor="", NewHandlerType="System.Web.Http.WebHost.HttpControllerHandler, System.Web.Http.WebHost, Version=4.0.0.0, Culture=neutral, PublicKeyToken=31bf3856ad364e35" 10:14:06.910
74. AspNetMapHandlerLeave 10:14:06.910
75. NOTIFY_MODULE_END ModuleName="ManagedPipelineHandler", Notification="MAP_REQUEST_HANDLER", fIsPostNotificationEvent="false", NotificationStatus="NOTIFICATION_CONTINUE" 10:14:06.910
76. NOTIFY_MODULE_START ModuleName="ManagedPipelineHandler", Notification="EXECUTE_REQUEST_HANDLER", fIsPostNotification="false" 10:14:06.910
77. AspNetPipelineEnter Data1="System.Web.ImplicitAsyncPreloadModule" 10:14:06.910
78. AspNetPipelineLeave Data1="System.Web.ImplicitAsyncPreloadModule" 10:14:06.910
79. i AspNetHttpHandlerEnter 10:14:06.910
80. i AspNetHttpHandlerLeave 10:14:07.363
81. r MODULE_SET_RESPONSE_ERROR_STATUS
Warning ModuleName="ManagedPipelineHandler", Notification="EXECUTE_REQUEST_HANDLER", HttpStatus="401", HttpReason="Unauthorized", HttpSubStatus="0", ErrorCode="The operation completed successfully.
(0x0)", ConfigExceptionInfo="" 10:14:07.363
82. i OUTPUT_CACHE_DISABLED 10:14:07.363
83. NOTIFY_MODULE_COMPLETION ModuleName="ManagedPipelineHandler", Notification="EXECUTE_REQUEST_HANDLER", fIsPostNotificationEvent="false", CompletionBytes="0", ErrorCode="The operation completed successfully.
(0x0)"