problem with ASP.NET app trying to publish a file to a sharepoint via sp webservice

Question

I have been triying to upload a file from an asp.net application to a sharepoint document library.

ASP.NET Configuration:

ASP.net 2.0 Integrated security checked on IIS Virtual Directory Anonymous access disabled Web.config file with tag and tag.

Both servers have been configured to "Trust for delegation" in AD.

when using ServiceReference.Credentials = CredentialsCache.DefaultCredentials it doesn't work.

The strange behaviour is that if you take away the tag the application works fine.

I have been struggling to find a solution for this problem. Any help will be welcome!