My time using nopCommerce has been very short but I've been impressed with it's functionality.  I've spent the last few weeks working on a site using VS 2010's internal web server but as I prepare to port my work to a hosted site I figured I'd play around with my site using IIS 7.5 on my Win 7 Pro system first as I know there would be kinks to work out.  Boy was that an understatement for me.  

Seeing that so many people have experienced similar issues with IIS locally I thought I'd share my experiences in hopes that this might make life a bit easier for someone else.  Before I get into this I'd like to make sure that it is clear that the problems I experienced weren't nopCommerce issues.  My issues were all configuration issues primarily related to IIS.

When I started this process I went into 'Control Panel --> Program and Features --> Turn Windows features on or off' and checked the "Web Management Tools" and "World Wide Web Services" under "Internet Information Services" (don't need FTP so didn't see a need to install it).  Windows did its install dance and I thought I'd be good to go once I added my site.  That would be a big ol'negatory.  Rather than write paragraph after paragraph about all the fun I had I will just go through the steps that I had to perform (with a few comments for prominent errors) to get things going.

  1) Open 'Control Panel --> Program and Features --> Turn Windows features on or off' and made sure the following options were set under the "Internet Information Services" selection.
          A. Web Management Tools
                  * IIS 6 Management Compatibility (all sub-selections)
                  * IIS Management Service
          B. World Wide Web Services
                  * Application Development Features
                         - ASP.NET (this will automatically select additional selections)
                  * Common HTTP Features
                         - Default Document
                         - HTTP Errors
                         - HTTP Redirection
                         - Static Content
                  * Health and Diagnostics (set options you wish for diag)
                  * Performance Features (set as you deem appropriate)
                  * Security (keep your environment as secure as possible)
       NOTE: By performing these steps I was able to resolve my HTTP Error 500.19 - Internal Server Error / Error Code 0x80070021 error relating to <handlers> in my web.config file.  This thread                  (https://www.nopcommerce.com/boards/t/6703/webconfig-error-iis-75-net-40.aspx) goes down the same line.
       NOTE: By performing these steps I was able to resolve my HTTP Error 500.21 - Module not recognized.

  2) Copy the nopCommerce directory into C:\inetpub\wwwroot
       NOTE: You can rename the directory of your store as you see fit.
       NOTE: You can also set VS to publish here (C:\inetpub\wwwroot\<your store>) if you like.

  3) Make sure IIS_IUSRS have read/execute access to your directory

  4) Open 'Control Panel --> Administrative Tools --> Internet Information Services (IIS) Manager' and do the following:
          A. Under "Application Pools" add a new application pool (name it as you desire for your site) and ensure that it set to use .NET Framework v4.0
          B. Right click on nopCommerce directory (your rename) directory under 'Sites --> Default Web Site' and select 'convert to application'
          C. Under "Application Pools" right clicked on the application pool created in step 4A above, selected 'Advanced settings...' and updated 'Process Model --> Identity' settings so the app could connect to the database.

  5) Register .NET 4 for IIS by 'Start --> Run --> c:\windows\Microsoft.NET\framework\v4.0.30319\aspnet_regiis.exe -i'
       NOTE: This last step cleared up the "HTTP Error 404.17 -Not Found -The requested content appears to be script and will not be served by the static file handler." error I was having.
      
My experience with IIS is limited and even more so for .NET development but using installation steps found in the forums along with the above steps I was able to get up and running.  As I said earlier, hopefully this will helps more than confuses.