The following is based on my experiences and (limited) knowledge. I am not an expert in anything, nor will I likely ever be one. My hope is that this might help someone, somewhere, sometime. If nothing else, it might be a good start for discussion.

Preamble
This series is for meant for educational use only, and is intended to be used in a lab environment. These have not been tested in the real world and may cause more problems then help. It will by no means be an in depth discussion.

Background
As mentioned before we will be creating a simple WAF to actively defend against offensive attacks. This post will start with some basic good practices for setting up IIS and IIS logging on a Windows 2003 or 2008 server.

Process
We start this series with a discussion on best practices. This is obviously not an exhaustive list, but a general guideline.

The most important step is to reduce the attack surface. The web server should be a dedicated web server with all unnecessary Windows services disabled and only the ports required to function open.

Watch which web service extensions are enabled. If there are multiple web apps, make sure you setup separate app pools running under separate non-privileged accounts.

Web applications should be configured to run on a separate drive, and NTFS permissions should be reviewed.

Sensitive data must be transmitted (and stored) securely using SSL/TLS.

Make sure you have a backup and recovery plan for the server, the IIS metabase and the web application.

Review the files in the web application. Remove files that are not needed. Any old files should not just be renamed to .old, or .bak. Store those files somewhere else. The only files in the web application folder should be those required to run the app.

Setup the logging properly. This will be critical for the simpleWAF. This is a great explanation of how to setup logging in IIS 6 http://thelazyadmin.com/blogs/thelazyadmin/archive/2006/02/02/IIS-6-Logging.aspx.
Make sure you select the uri stem and uri query fields.

You should also enable utf8 logging by going to IIS Manager, right-click the local computer, and then click Properties. In UTF-8 Logging, select the Encode Web logs in UTF-8 check box, and then click OK.

UTF8 is a method of encoding that allows for both single and multibyte characters in one string. It is a good security practice to enable the UTF-8 format in case of an attack that might not translate correctly to the default english character set.

Logging in IIS 7 (and 7.5) has some many new security improvements, including an advanced logging option, but for the purposes of this series, the regular logging is all that is required.

To turn on logging, in the Features View, double click on Logging. Click on the select fields to choose what will be logged. In IIS 7, UTF8 is enabled by default.

Next Steps
Quick introduction to using IPSec as a firewall in Windows 2003.