I ran into this while working with a client over the weekend.  My client is using VS.NET 2002 (with the .NET Framework 1.0) and is creating an in-house, intranet application to be used simultaneously by 35-50 users...ok that part doesn't matter.  Basically what it came down to is they are in the process of performing some personnel changes and wanted to ensure that prior to taking action that they had all of the source code and could continue on making changes and improvements to their software.

First of all, I'd copy the files (mostly .aspx pages) locally to my machine simply to see if I could compile the project from within Visual Studio.  Everything loaded fine except the web project.  It failed with an error 'Unable to get the project file from the web server'.  This was disconcerting.  I know I'd seen the error before (about 15 months ago) and had solved the problem but with my client looking over my shoulder the heat was on!  I had to get this to work.  I double checked all of my settings - everything seemed in order.  Interestingly I didn't get this problem with any of my web applications.

Then my memory started to function again...I recalled that VS maintains a folder called VSWebCache found in <root>\Documents and Settings\<user>\VSWebCache\<machinename>.  All I had to do was delete all of the contents of this folder and voila! it worked - I could open the project!  It turns out that VS.NET creates and uses this directory in order to facilitate offline development and as a working directory.

Simple, but stupid, solution.