I don't think 5.1 sp3 supports iis 7 which could be what's casuing the problem.
IIS7 is not supported with CMS-R1, please have look at system requirements. If you want to give it a try then Ruwen's blog below might help you.
Also some of the issues in .net 3.5 and R1 running on IIS7 are explained by Fredrik Tjärnberg just in case.
Thanks guys, I've moved onto an XP machine running IIS 6 and manged to create a new 5.1 site using the EPiServer manager.
I'm basically just plugging my existing site into this newly created one to get it up and running, a bit fiddly but I'll get there eventually!
I'm currently attempting to install verison 5.1.422.4 of EPiServer to run an older, existing site.
I have Visual Studio 2005 SP1, .NET 3.0 and SQL Server Express 2005, yet I can't install EPiServer as I keep getting the pop up claiming that my system does not have the prerequisites for installation, VS 2005, SQL 2005 Express and .NET 3.0.
I'm running Windows 7 which is the only reason I can think of why the installation isn't working. I do have EPiServer 5.2.375.236 and 6.0.530.0 installed which I don't remember having any problems with.
Does anyone have any advice?