(I just wrestled with this issue and didn't find much out there so I'm dumping my problem and resolution here)
We've had a .NET 1.1 web project under development hosted on a Windows 2k3 server which had a valid SSL certificate installed on the website hosting the project. There were no problems opening the solution and its projects while they were being hosted on this server.
I recently got the project under source control. However, after checking out a local working copy I can no longer open one of the project files. I get an error stating '...The certificate authority is invalid or incorrect.'
My local Dev PC is running Windows XP Pro SP3. IIS 5.1 is using a self-singed certificate (generated with OpenSSL) issued to localhost which is installed on the web site hosting the project locally. I can access the web site using a browser with no problems (other than an initial untrusted CA warning). The .vbproj.webinfo and .sln files for the project and solution are referencing localhost.