server is not running asp.net version 1.1
When you try to create a new ASP.NET 1.1 project or try to open, you may receive the following error message

visual studio has detected that the specified web server is not running asp.net version 1.1

If you have already googled and come across Microsoft knowledge base article 817267.
PRB: "The Specified Web Server Is Not Running ASP.NET Version 1.1" Error Message When You Create ASP.NET 1.1 Application ( MKB817267 )

don't get confused by this article, the article applies to windows 2003 server.

You can actually fix this problem in less than 5 minutes and in 3 steps:

1) Open Add/Remove program and uninstall dot net version 1.0.

2) If dot net version 1.0 is not in the list of installed programs, find the following folder and delete it if found C:\WINDOWS\Microsoft.NET\Framework\v1.0.3705

3) run the executable with the following option from command window: C:\WINDOWS\Microsoft.NET\Framework\v1.1.xxxx\aspnet_regiis.exe -i

And you should be back in business.