ASP.NET MVC3 401.1 Error in IIS7.5

I have setup an ASP.NET MVC3 website using Windows Authentication and am getting a 401.1. The error code is 0x8009030e on the 401 page. Users should be able to access the site using their domain credentials.

I don't get the error if I logon to the machine and hit the website via localhost (http://localhost/mysite). However, even logged onto the server, if I hit the website through the server name (ie http://machinename.com/mysite) I still get the error.

The website uses it's own .net 4.0 app pool and using integrated mode. The site is configured for Windows Authentication only in the config.

<authentication mode="Windows" />
<authorization>
  <deny users="?" />
</authorization>

...and in IIS. I don't have extended properties configured, and have enabled kernel-mode authentication (both are the default). I've tried toggling "IIS Manager Permissions" without any luck.

Any ideas?

I had to do two things to get this working properly:

1. Make the app pool use "Classic" instead of "Integrated" mode. After making, the change I was getting a 403.x error.
2. I solved the 403.x error by granting (Read/Execute) NTFS permissions to the "Domain Users" group.