>That was sort of my point - if the old processes are terminated then it would imply that, as far as IIS knows, the new processes was successfully started.
>Might be interesting to log Application_Start() and see if it gets that far ? Have you checked the application log BTW ?

This is a situation that cannot be simulated. Thus, we only have to wait until it happens next time. And, this does not happen very often. Only three times since November 22nd this has happened. My Application_Start() equivalent code is placed into Page_Init(). This is where I log the records of the new worker processes loaded in memory. It is there because it is from that point the framework is loaded thus I can start logging some stuff. There are so many data to analyze, and this is moving and recycling so fast, that it is very difficult to go back in time to get something out of it.

>Do you mean turning off compression? Maybe IIS clears out or recreates the folder on recycle (and does that regardless of whether compression is enabled or not)

I am still waiting for a revision on the permission of the Web site account on that directory. Once I get that information, I will be able to know if something got adjusted. Otherwise, it would imply something higher in the IIS level and I would need to escalate that to Microsoft.