Hi Robert,

I have having a very similar issue, however this is with Windows 2008 R2, have tried all the settings and still get the following error:

Description: The application attempted to perform an operation not allowed by the security policy.  To grant this application the required permission please contact your system administrator or change the application's trust level in the configuration file.

Exception Details: System.Security.SecurityException: Request for the permission of type 'System.Web.AspNetHostingPermission, System, Version=2.0.0.0, Culture=neutral, PublicKeyToken=b77a5c561934e089' failed.

[SecurityException: Request for the permission of type 'System.Web.AspNetHostingPermission, System, Version=2.0.0.0, Culture=neutral, PublicKeyToken=b77a5c561934e089' failed.]
 

Updated security settings, have tried both install and source and come up with the same results.  Application pools have been given appropriate security levels along with a seperate application pool.  With R2 there seems to be a few changes, however I believe all of this has been iimplemented, your insight to a solution would be much appreciated.

Thank you,

Chad