Hi tclc,
I had the exact problem in my IIS7.0 in Vista today, I had tried the AppCmd.exe unlock methods and no luck.
I first removed the <Clear/> tag within the <Modules /> node in the web.config file of the wwwRoot, which is the config file of my Default Web Site. It then complained that there was a duplication of Module in the <Modules /> node.
In your case, it should be the <Handlers/> Tag, instead of my <Modules/> one.
I ended up removing all the child tags in the <Modules></Modules> Now it is working 100% as it will inherit from the parent config (ApplicationHost.config).
Understood that you problem was resolved. For anyone having a similar problem, back up the web.config file and give it a go.
Regards,