Windows Live Essentials 2011 Breaks Google Chrome With IIS9 Sites

So if you are a google chrome user, and you are happily accessing your company’s IIS9 sites that use NTLM authentication, and you just so happen to update to Windows Live Essentials 2011 to get the latest version of Windows Live Messenger, you may be in for some frustration.
Here’s the error message:

Error 9 (net::ERR_UNEXPECTED): Unknown error.

Installing the 2011 build of Live Essentials essentially breaks Google Chrome when it tries to access those corporate intranet sites. The easiest solution is to just uninstall Windows LIve Essentials 2011 and find a copy of 2010. The other option is to update Google Chrome to the beta of 7.0. That also fixes it. Personally, I went with updating Google Chrome, that worked best for me.
Hope that helps people.
UPDATE: Looks like moving to the Chrome beta doesn’t fix it completely. After more testing it’s working on some internal sites and not on others. I guess the best strategy really is to just uninstall Live Essentials for the time being.
UPDATE 2 (10/8/10): Looks like Google Chrome Beta just updated today and resolved the remaining issues! I love Google Chrome, they fix stuff in days that it takes Firefox two years to get around to.

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