For everyone else...

Code:
System.EnterpriseServices.Internal.IISVirtualRoot vr = new System.EnterpriseServices.Internal.IISVirtualRoot();
string sError;
vr.Create("IIS://localhost/W3SVC/1/Root",@"C:\Demos\WebServices\","WebServices",out sError);
* code copied from http://blog.crowe.co.nz/archive/2006/05/30/642.aspx