First, Thank you Gaby for sharing the solution and helping all us with similar problems (sarcasm).
I am running a W2K Pro workstation and a W2K Server with IIS. My Server-Side controls were not functioning at all as well.
I found that .NET did not populate the Application Name in the Properties of the Web Site in IIS. (Internet Services Manager, Default Web Site, RIGHT-CLICK Client-Server Processing, select PROPERTIES, DIRECTORY tab)
I clicked the REMOVE button and then the CREATE button (Configuration button will become CREATE when the REMOVE button is pressed)
This fixed my Server Side controls for me.
Hope this Helps...
Not ashamed of my mistakes as I always learn from them