Rick click over the shortcut. And in properties in the Compatibility tab select Run As Administrator.
Also confirm IIS is installed. It is not installed by default on Vista. You have to go and Add/Remove Windows Components.
See here.
You might not have IIS setup properly on the local machine, I would verify your IIS configuration before continuing. You can always create a website or webapplication that runs through cassini instead and provide a folder path vs a IIS path.
P.S. Even if you are a machine administrator, with vista if the access restrictions are on you must still always specify that you wish to run the application under an administrator context.
I uninstalled IIS and then reinstalled using only the bear minimums and it worked.