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Yes, config.php is where it should be in the moodle directory...

I deleted config.php to see what would happen if loader.php could not find it, and it gives a different error message: "Warning: require(../config.php) [function.require]: failed to open stream..."

When I copy config.php back into place this error disappears and my old error (the one I posted before) returns.

So I don't think the problem is with config.php... Any other suggestions?

Thanks