Failed to Create Web Application

In the past few weeks I've come across this error a lot, Scot Hillier does a nice job of shedding some light on this issue:

SharePoint 2007 Web Application Creation Fails

Scot mentions the "WSS Timer Services" being the source of the issue. After doing a bit of research, the Timer Services are very resource intensive (memory). Some of the side affects you'll notice when the Timer Service is the culprit include:

• IIS Manager fails to locate the "localhost"

• Event Viewer will consistently contain "memory corrupt" errors directed toward WSS Application Timer Service.
• Pesky COM errors when creating a Web Application

At the moment the best bet with this growing issue for now is to schedule regularly recycle the WSS Timer Service to free up the overwhelming leaks and adjust the memory allocation to your WSS Timer Service for best results.

Hope this helps,

~:)