The Background (skip to the bottom if you want the question)
Recently I upgraded an SVN repository (hosted on assembla) to SVN 1.7. After doing so,
I solved this by accessing the security settings for the website folder and and clicking Advanced and then Change Permissions for the IIS_IUSRS user. I checked the "Replace all child object permissions with inheritable permissions from this object" and clicked apply.
Before that, I had given the IIS user full permissions to the hidden tmp folder in the root of the checkout, but I don't know if this helps with anything.
I'm not sure if this is a permanent fix, but in case it is not, you can at least use it to reapply permissions for all the files in a single operation.