Ouch! Permissions Spankdown.
I won't go too far into the wheres or whys but the machine I am graciously hosted off was in or around a domain and dcpromo last weekend. The following kb article tells part of the story.
Microsoft Knowledge Base Article - 332097.
It's incomplete however as it doesn't mention that dcpromo also hoses permissions for ASP.NET runtime on
systemroot\temp. Assemblies can't be copied over at runtime, can't be loaded and you'll get a number of policy related error messages. Mine were being triggered in two applications that both use custom HttpModules, ASP.NET apps without them ran fine.
LOG: Policy not being applied to reference at this time (private, custom, partial, or location-based assembly bind).
Anyway, special permissions (read/list folder contents and delete) are what's required by ASP.NET into
systemroot\temp and the problem is fixed. Fun stuff trying to figure it out on a remote server.
Odds of someone else having this random issue and finding this page are slim, but I'll sleep better knowing it's not impossible.