In Visual studio, Solution->Web.Project->Properties->Web, I have changed my Project Url from http://localhost:51123/ to http://localhost:51123/NewProj
I had a problem of same type. Running my site published on IIS, the same error was shown.
I saw a web.config file in the wwwroot folder (out of application folder).
I removed this file and the application ran OK.
Look for a web.config file placed in a wrong folder (above your folder application).
Good luck!