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I am trying to setup a merge replication from SQL Server 2005 to SQL Compact 3.5 sp2. My environment:
- Server: Windows 2008 R2 64bit
- SQL Server 2005 installed on server
- IIS 7 installed on same server with IIS6 compatibility components installed
- SQL Server Compact 3.5 SP2 Server Tools installed on server

I create the publication without issue.

However, when I am running the Web Synchronization wizard from SSMS I get to the point of creating the virtual directory and receive an error message "IIS was not found on the Web Server. Please specify a computer name that has IIS installed.".

I can browse localhost in Internet Explorer without issue. Disabling the firewall doesn't eliminate the error.

I've followed the recommendations here: Configuring Web Synchronization on Windows 2008 64Bit IIS7 for Merge Replication with SQL CE Subscribers

Any ideas?