I am having an issue using SPD to create a workflow on our SP Site. (MOSS with
all the latest updates). With the issues I was having I asked to poke around on
the SharePoint server to try and diagnose the issue. I couldn't find anything
that was overtly incorrect with the site or the web.config but there was one
thing and I was wondering how much of an impact it would have for things like
Workflows in SharePoint designer. The IIS Folder for the site is not in the
usual location. C:\Inetpub\wwwroot\wss\VirtualDirectories but instead it has
been moved to C:\Inetpub. Does anyone have any experience on the kinds of
abnormalities that this can cause?

With SharePoint designer I can log in to the site, and I can create the workflow
just fine. The issue comes when I try and "Finish" the workflow. I invariably
get the following error.

Errors were found when compiling the workflow. The workflow files were saved but
cannot be run.
Unexpected error on server associating the workflow.

I did research this on google and saw about the web.config file, but as far as I
can see, the web.config is as it should be, just not in the location on the
server I would expect it to be.

Anyone have any thoughts on this?