Website does not work without network connection

[Papa.Coen]

Hi, I have a problem with my website (aspx/c#); I get a 'Server
Application Unavailable' when the host (127.0.0.1/localhost) does not
have an network connection (tcp cable unplugged, on purpose )

I use:
- dotNET 2.0 (!!, Google searches place this behaviour with dotNET 1.0)
- IIS 5,1
- WinXP pro (activated & unactivated)
- I have the problem in both a VMWare demo environment and my dev
desktop
- both systems are up to date with the latest updates.

I have tried:
- Adding IUSR & ASPNET to admin group
- Altering Machine.config processModel to username=machinename/SYSTEM,
password=AutoGenerate
- Installed Loopback network adapter
- removed/disabled some/all network adapters (the only thing I didn't
do was physically removing them)
- multiple aspnet_regiis / IIS reboots
- changed rights & users in IIS admin console directory security.
- I am local admin
- The desktop & demo are not Domain Controllers, desktop is of a
domain, the demo is member of a workgroup.
- desktop has sdk installed, demo redistributable

all with no results...

Who can help me out?

 

[Papa.Coen]

This problem occurs when developing/debugging/demonstrating the website
on the localhost...