I just wanted to add to the above finding.
I ran a netstat -ano and found that port 80 was being used by another application with a process ID of 1976. (So IIS 7.0 was right to tell me that the process was already in use).
So I then opened the Task Manager (add the PID column to the view) and found that the process using port 80 was SKYPE!!!.
Turned off Skype (no need to uninstall) and everything worked.
Hope this helps someone else.
Antonio Chagoury
Inspector IT, Inc.
cto 2.0 - A Blog by Antonio Chagoury