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Do you get the "CGI Application Misbehaved ... didn't return the right headers" message? If so, that I believe is an IIS/CGI issue when you run too many CGI applications at the same time. Look at your CPU levels to see if it's running at full capacity at any time.
I would first output the headers and debug the code to make sure there are not any bizarre loops going on or other things that might not get the headers set correctly in the response. Then look into any other pieces of code...you might have an infinite loop going on that is causing other CGI apps to hang. If you were upgrading from PHP 4 to 5 I would say you probably are using deprecated functions/modifiers/etc, but since you are not, there's a good chance it might not be the code. But I would start there first.
It's tough to say without seeing your code and environment. Is it possible not to run PHP as CGI?
The script is a PHP site I've built on CodeIgnitor. It works perfectly fine under PHP 5.1.2, no CGI errors or anything. The CGI error only occurs when ANY PHP script is called up in the following style:
The environment is a Win 2003 server with PHP running as a CGI module under IIS6. It is possible to run PHP as an ISAPI extension and I'm going to try this next!
It's all running on lovely ISAPI now! Woo.