By default, you do not have Administrative privileges if you're logged on as a user (other than the built-in Administrator account) even if this user was added to the local Administrators group on the machine (this is a new security feature in Windows Server®2008 with-IIS 7.0, called LUA).
Make sure to either log-on as the built-in Administrator account, or explicitly invoke applications as the built-in Administrator as needed, using the "runas" cmd-line tool. For example, to launch notepad.exe you could run this command: "runas /user:administrator notepad.exe".
You will be prompted for the password of the Administrator account. It is useful to have a cmd-box shell that is already elevated, by running "runas /user:administrator cmd.exe".
Every application you run from that cmd-box will be elevated as well, and you will not need to use the "runas" syntax from that cmd-box.
Excerpted from:
http://learn.iis.net/page.aspx/126/how-to-use-metabase-compatibility-with-iis-7/