I will try to write in short and simple
1. Downloaded the install package from this site.
2. Created a folder in main IIS root called DotNetNuke
3. Given ASP.NET full control for this folder
4. Right click on downloaded install zip file (DotNetNuke_04.08.04_Install.zip) and click unblock
5. Now unzip the DotNetNuke_04.08.04_Install.zip file contents to DotNetNuke folder which you have created earlier in the root of IIS
6. Now right click each of the file in DotNetNuke folder and click unblock. Now open the Install folder to repeat the same process to unblock each folder and file in the install directory. Next repeat the same process for all the sub folders and files in the install directory.
7. Give full control to ASP.NET web.config file (how? right click on that file and click properties -> security -> add-> select the asp.net user and click full control to that and click ok)
8. Now create a Database name as DotNetNuke using SQL Server Enterprise Manager
9 Create a new user -> dotnetnuke & password of your choice.
10. Now add this new user to your Database DotNetNuke with the following permissions Public, db_owner, db_accessadmin, db_securityadmin (you must select all these permission to this user for this database).
11. Now you are ready to start the installation process.
12. Open your web browser (firefox :) )
13. Type localhost
14. Select custom & click next
15. Just click next
16. Select sql 2000/2005
17. Now input your server details (depends on your configuration, example: local)
18. remove the tick mark so that you will be prompted with username and password fields. provide those details here.
19. Click Next (you can untick the run as owner but doesnt make any different, if it does do the other way).
20 thats it click next and next and follow the instructions of the installer and you should be fine.
The major trick here is you need to unblock each file in the root level as well as in the install folder and the files that are in sub folder of the install.
Cheers