A few things come to mind. 1, in the 1.1 days, I think you needed to have IIS installed. Are you on a machine with IIS installed.. and if so.. IIS 6? If not, I'm not sure how well you'll be able to run the project.
2, If the answer to question 1 is yes, look at your Windows Event Viewer, 500 level errors should be captured there, and hopefully will give you some clues - if it's a security issue, configuration problem, etc.
3, you can always attempt to upgrade the project and run it in a newer version of visual studio.. you are trying to use a project that is 12+ years old after all..
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