I have set up a multisite (subdirectory) installation at litcrawl.org. I can access the main site, but not the subsites (litcrawl.org/austin, for example).
When I first installed, I could get to the front pages of the subsites (litcrawl.org/austin) but not their backends (litcrawl.org/austin/wp-admin). After reading the posts here, I went in and changed all database references to litcrawl.org (no http://www.litcrawl.org). All that seems to have done is broken the front ends as well.