Keep in mind, IIS doesn't set usernames and passwords, Windows does. IIS
also doesn't handle the security on the files, it requests authentication of
the file from Windows and the NTFS subsystem. Now, a little more information
would help. When you say local website, is it local as in running on your
machine or is it running on another machine in the local network (have to
ask since many people get this confused)? Do you have the files for your web
site on another drive and you just reinstalled the OS? If not, are they on
the same drive as the OS and you just re-installed the OS over the old one?
One of the key things to remember, every single file has some sort of
username or group associated with it. Reinstalling the OS means you've lost
all the old accounts on the machine. You can create new users with the exact
same name as before, but the accounts are fundamentally different because
they have a brand new globally unique identifier. That means all the user
permissions on the old files are rubbish since they have security id's that
mean absolutely nothing to the new copy of windows. So, in essence, the
settings you had before that worked transparently for you are now rubbish,
which is why you are getting prompted for a username and password. The
easiest thing to try and do is to use the Permissions Wizard in IIS
Management Console to set a new baseline set of permissions. This will
ensure that the minimum set of permissions for IIS to even view the files is
available. You may also need to take ownership of the files through the
Security tab on the Properties dialog of a drive or directory (make sure you
disable simple file sharing under Windows Explorer's Tools | Folder Options
| View menu, it should be the very last item in the list, this will enable
the security tab). Before you make sweeping changes to NTFS permissions, you
may want to review some online information to make sure you don't
accidentally tighten the computer so much you can't do anything (which can
happen).
The problem here is EW and IIS rely entirely on your NTFS file permissions
and Windows to determine security. In a new install, this is fairly simple.
If you do a re-install you end up with having to deal with the old security
data before you can do a lot of things.