I fought this for a week - there was so much junk info out there.  My system config is as follows:

• Windows SBS 2003 SP2 
• IIS 6
• Hosting a mix of ASP.NET 2.0, 2.5, 3.5 sites

When I added my first Visual Web Developer 2010 site using the .net 4.0 framework, These errors happened.

Server Application Unavailable

The web application you are attempting to access on this web server is currently unavailable.  Please hit the "Refresh" button in your web browser to retry your request.
Administrator Note: An error message detailing the cause of this specific request failure can be found in the application event log of the web server. Please review this log entry to discover what caused this error to occur.

...and in the Application event Log...

Event Type:    Error
Event Source:    ASP.NET 4.0.30319.0
Event Category:    None
Event ID:    1007
Date:        8/4/2010
Time:        3:34:08 PM
User:        N/A
Computer:    WEB1
Description:
aspnet_wp.exe could not be launched because the username and/or password supplied in the processModel section of the config file are invalid.

For more information, see Help and Support Center at http://go.microsoft.com/fwlink/events.asp.

OMG this was so easy.
On the Web Server...

1. open the C:\WINDOWS\Microsoft.NET\Framework\v4.0.30319\Config folder. 
2. Edit Machine.config.
3. in the  <system.web></system.web> section, change <processModel autoConfig="true"> to <processModel username="SYSTEM"></processModel>
4. Save and exit.
5. open a command window and enter IISRESET.
6. Your web site should now work.