Testing on Windows Server 2003 w/ VS 2003 and ASP.NET 1.1 and 2.0 installed, both versions build and run OK in my tests. I did encounter the error "Could not load type '_Default'" running the 2.0 version until I switched the virtual dir properties (ASP.NET tab) to use ASP.NET 2.0.
There are two versions of the WebLauncher sample (the one in WebLauncher is for .NET 2.0 and the one in WebLauncher\NET1.1 is for .NET 1.1). It looks like you may have navigated to
http://localhost/Build/NET1.1/Default.aspx rather than
http://localhost/Build/Default.aspx after building -- I did encounter the error message you indicated when doing that, which makes sense (see
http://geekswithblogs.net/ranganh/ar.../25/37609.aspx). Here are some other possibilities:
http://tinyurl.com/2emvg6