Let's consider the example:
- Fresh installation of Windows 2008 with Web Server role IIS and ASP.NET installed.
- A web application using AjaxToolkit
By default the Application Pool on IIS 7 is set to Integrated Pipeline, which does not work with AjaxToolkit and switching to Classic mode caused several issues:
- 404.17 - File Not Found
Take a look on the 'handler' in the 'Detailed Error Information' - IIS treats .aspx file as a static content means ASP.NET is not installed on IIS with your application, and, definitely you need to register it for your site, but .. - aspnet_regiis.exe does not work well on IIS 7.0 (even with IIS 6.0 support installed) caused the "The error indicates that IIS is not installed on the machine .." exception what means you need to use server features to install it instead of command line
The quickest solution here is to update ASPNET by using the features - with no changes on application pool go to server roles, uninstall and then install again ASPNET. Both the issues will be fixed.