I was trying to set up a development server recently on a 64 bit machine with Windows Sharepoint Services 3.0 and came across this. After installing the server farm, while Sharepoint tries to load the Central Administration page, it popped up with this error
This can be easily fixed by going to your parent web.config file under C:\Windows\Microsoft.NET\Framework\v2.0.50727\CONFIG and change to allowOverride="true", this allows the Sharepoint's webconfig to override the settings in your parent configuration file. Take note that your Machine.Config and Web.Config supersedes the settings in your custom web application's Web.Config file. Hence if there's a need to override the parent configuration, you have to explicitly allow that by setting the allowOverride to 'true' as mentioned above.