RDS connections from Report Builder fail on ColdFusion MX 7.0.1 with certain IIS configuration

(TechNote) If the Integrated Windows Authentication option is checked and the Anonymous Access option is unchecked in Directory Security in IIS (port 80), RDS connections to the ColdFusion server will fail from the Report Builder with the following error:

The following error occurred while trying to connect to
the RDS Server: HTTP/1.1 401 Access Denied.

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