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VS2005 - "Edit and Continue" changes are not allowed while debuggi

Streamline <streaml...@nospam.nospam>

Initial setup:
Microsoft Windows XP Professional Version 2002 SP2
Microsoft Development Environment 2003 Version 7.1 (Visual Studio)
Microsoft .NET Framework 1.1 SP1
Microsoft Visual C# .NET

I created a solution containing a Web project and a Class Library project.
The Web project that has a project reference to the Class Library project.

I then installed:
Microsoft Visual Studio 2005 Standard Edition Version 8.0
Microsoft .NET Framework 2.0
Microsoft Visual C# 2005

I used VS2005 to upgrade my solution.

When I debug, I can step into the Web project source code, edit and
continue. I can also step into the Class Library source code. However, when I
try to edit the Class Library source code, I get the following error:

Edit and Continue
Changes are not allowed when the debugger has been attached to an already
running process or the code being debugged is optimized.

The Class Library project Build properties shows Configuration: Debug, and
Optimize code is unchecked