I got this strange problem yesterday at work. One of our developers was trying to upload files to e new server and he got 500 access denied each time he tried. After he spent hours double checking all the NTFS rights and IIS settings he asked me for help. At the first look I thought the IIS server had been messed up some how. After verifying everything that he told me was OK, after all he is a coder and they usually don't understand servers, I really didn't know what to do next. So I thought about it for a moment and then I started from scratch, checked the entire solution from the bigger picture.
So with the system blueprint in front of me it all started to clear up. The server was situated in our server center across town and all his traffic was passing through a VPN tunnel between our two ISA 2006 servers. The ISA server sets all the FTP rules to "Read-Only" by default but I didn't realise that this was a problem for the VPN site to site tunnel also. After checking the routing rule and then the access rule for the communication between the two networks I found the settings for FTP traffic between the two ISA servers. After I unchecked the "Read-Only" check box for the FTP traffic on the VPN site to site access rule it all worked as designed.