On my Windows 7 computer, c:\inetpub\wwwroot is not updateable unless I turn off User Account Control. What's up with that?
Face it, development on a machine with UAC enabled is going to be really annoying. I leave mine on the lowest setting at that's about all I can tolerate.
If I were you, I would deploy your web apps to different directory and then point IIS inside that one instead.
There are two things going on here:
1) The WWWROOT directory, by default, allows full permissions to anyone in the Administrators group, but read-only permissions to Everyone.
2) Processes started in an interactive login session do not get the Administrators group token by default, even if the user is a member of that group. In order to get that token attached to your process, you need to elevate through a User Account Control consent prompt. (You can also elevate a process to have an Administrators token if the user account isn't in the Administrators group, but you will be prompted for the credentials of a user that does)
The suggestion that you turn down UAC's settings is not a good one -- this is a systemwide setting that directly, and negatively, affects the security of your entire system. Instead, do the right thing: change the permissions on the wwwroot directory to give your user account full access.
Beeing in Administrators group and setting privileges for it will not disable UAC alerts. If you don't want to see UAC warnings without turning UAC off, you need to add your user directly to your wwwroot folder's security settings.