For those of you who may be having difficulty installing and running Virtual Server 2005 R2 on Windows Vista, Ben Armstrong, aka Virtual PC Guy, has written an excellent post on his blog to help you out.
In the post, Ben takes you through the installation step by step, and also answers some questions on the install process.
Can you take a look at this? I put this in MSDN but I've tried what you suggested to no avail:
So, just to confirm, if you go to 'Turn Windows Features on and Off', and expand on Internet Information Services - it should look like the list here http://blogs.technet.com/mattmcspirit/archive/2006/10/18/running-virtual-server-on-vista.aspx but you also need to enable ALL II6 Settings (Just tick the IIS6 Management Compatibility box) then finish. This should allow you to install correctly. In all honesty John, I'd firstly remove all IIS components, restart Vista, then, manually add the components back in, using the link above as a guide (including the IIS6 Management Compatibility bits) and then restart Vista again. Once back on, start the setup for the Admin Console.
Once installed, when you run the admin console, you may encounter issues around authentication. To solve this, you'll need to first log onto the Virtual Server Admin Page with IE being 'Run as Administrator' (right click IE, run as..). Then, user accounts have to be granted administrative privileges for Virtual Server. To do this select Server Properties from the Virtual Server section of the navigation pane on the Virtual Server web site (you will need to run IE “as administrator” in order to do this). Then select Virtual Server security, Add entry, and create a new entry for your user account with full control. You need to do this because the UAC feature of Windows Vista stops Virtual Server from being able to detect that you’re a member of the administrators group, unless you’re running IE “as administrator every time.
The second step involves adding the URL for the Virtual Server website to the trusted sites via the tools menu in Internet Explorer. “You should now be able to open up the Virtual Server administrative website using the icon in the start menu, without needing to run the process “as administrator.