The Web server does not appear to have FrontPage Server Extensions installed

[Usarian]

Visual Studio 2008
Vista Ultimate
IIS7

I built a website (C#/ASP.NET 3.5).

I try to publish the website overwriting another website I had built in
VS.net 2005 previously, pointing VS2008 to local IIS. It fails with that
message. What am I doing wrong?

Also if I point VS2008 to local file directory and overwrite, it publishes
successfully, but I can only access the front page. Any page located in a
folder says I don't have permission to access that page through my browser.
I have checked security in explorer and in IIS and have everything set to
allow.

Please advise, Thank you!
-U