Even I am encountring the same error. If website already exists, following
error shown is this:

WriteIIS7ConfigChanges:  Error 0x800700b7: Unable modify existing WebSite
WriteIIS7ConfigChanges:  Error 0x800700b7: Failed to configure IIS site.
WriteIIS7ConfigChanges:  Error 0x800700b7: WriteIIS7ConfigChanges Failed.

Actually we are installing three virtual directories in a website. Earlier
in Wix 2.0 ConfigureIfExist use to work but now you cannot write iis:Website
component in all wix of same website. It always throws this error. Is this a
bug or there is a workaround it.

Thanks 
Gaurav
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