R – Unable to open the Web site: http://.. Forbidden

I would validate that you have example3.com pointing to the proper location on disk. Also ensure that it is not stopped.

The fallback to example1 is due to the binding entry with no header value.

Please refer to this link for the Security Issues: http://docs.sun.com/source/816-5666-10/esapmsfp.htm

If you installed the extensions after you had configured the permissions, you may have to replace the ACL's on those files by resetting the permissions for the project's folder because of the vti* folders and files it creates within the web application itself; it resets the permissions for those folders and will remove the permissions you have set. Also, it may map your application's _vti_bin folder to the program files folder location. I know the answer is kinda late, but better late than never I always tell her!

Would recommend TFS source control development over doing development using a UNC shared path.