It would help a lot if you would tell what version of BugNet you are attempting to install and what platform you are installing on.
I just resolved this issue on Windows server 2003 R2 x64.
I had insure t that all the latest .net updates had beend installed through windows update.
Open IIS Serevice Manager and select Web Service Extensions.
if you have the option ASP.NET v2.0.50727 aviable then make sure it's status is set to Allowed.
if you do not see this option then there are stll .net updates that you have not installed