web.config in subdirectory … problem with pretty permalinks

Hello everyone,

I have 2 wordpress installations on an IIS server. One is the root and the other a subdirectory. Both have the default web.config files. The web.config in the subdirectory does not help with the pretty permalinks.

1) I cannot change the server to Linux (Office Politics, Bah!)
2) Pretty permalinks is important (Buddypress)
3) I do not understand web.config much. I am trying to.
4) Pretty permalinks do work in the root installation

The code in web.config as given

<?xml version="1.0" encoding="UTF-8"?>
<configuration>
    <system.webServer>
        <rewrite>
<rules>
<rule name="Main Rule" stopProcessing="true">
<match url=".*" />
<conditions logicalGrouping="MatchAll">
<add input="{REQUEST_FILENAME}" matchType="IsFile" negate="true" />
<add input="{REQUEST_FILENAME}" matchType="IsDirectory" negate="true" />
</conditions>
<action type="Rewrite" url="index.php" />
</rule>
</rules>
</rewrite>
    </system.webServer>
</configuration>

Please do help someone … I just don’t get this one ?
(I have searched the forums and the web for a long time)