Problem with configuration of C# Script 'Compiler executable file csc.exe cannot be found - C# Script'

Question

I have a script that has been used on other servers without issue that relies on C# Script to perform automated tasks. I recently have tried to transfer this to a new server and have been getting the following error when I try to run any scripts:

See the end of this message for details on invoking 

just-in-time (JIT) debugging instead of this dialog box.

************** Exception Text **************

System.InvalidOperationException: Compiler executable file csc.exe cannot be found.

   at System.CodeDom.Compiler.RedistVersionInfo.GetCompilerPath(IDictionary`2 provOptions, String compilerExecutable)

   at Microsoft.CSharp.CSharpCodeGenerator.FromFileBatch(CompilerParameters options, String[] fileNames)

   at Microsoft.CSharp.CSharpCodeGenerator.System.CodeDom.Compiler.ICodeCompiler.CompileAssemblyFromFileBatch(CompilerParameters options, String[] fileNames)

   at csscript.CSExecutor.Compile(String scriptFileName)

   at csscript.CSExecutor.Compile(String scriptFile, String assemblyFile, Boolean debugBuild)

   at CSScriptLibrary.CSScript.Load(String scriptFile, String assemblyFile, Boolean debugBuild, String[] refAssemblies)

   at CSScriptLibrary.CSScript.LoadCode(String scriptText, String assemblyFile, Boolean debugBuild, String[] refAssemblies)

   at CSSScript.ShellExForm.Initialise()

   at CSSScript.ShellExForm..ctor(Boolean readOnlyMode)

   at Config.ConfigForm.ConfigForm_Load(Object sender, EventArgs e)

   at System.Windows.Forms.Form.OnLoad(EventArgs e)

   at System.Windows.Forms.Form.OnCreateControl()

   at System.Windows.Forms.Control.CreateControl(Boolean fIgnoreVisible)

   at System.Windows.Forms.Control.CreateControl()

   at System.Windows.Forms.Control.WmShowWindow(Message& m)

   at System.Windows.Forms.Control.WndProc(Message& m)

   at System.Windows.Forms.ScrollableControl.WndProc(Message& m)

   at System.Windows.Forms.ContainerControl.WndProc(Message& m)

   at System.Windows.Forms.Form.WmShowWindow(Message& m)

   at System.Windows.Forms.Form.WndProc(Message& m)

   at Config.ConfigForm.WndProc(Message& m)

   at System.Windows.Forms.Control.ControlNativeWindow.OnMessage(Message& m)

   at System.Windows.Forms.Control.ControlNativeWindow.WndProc(Message& m)

   at System.Windows.Forms.NativeWindow.Callback(IntPtr hWnd, Int32 msg, IntPtr wparam, IntPtr lparam)

************** Loaded Assemblies **************

mscorlib

    Assembly Version: 2.0.0.0

    Win32 Version: 2.0.50727.1433 (REDBITS.050727-1400)

    CodeBase: file:///c:/WINDOWS/Microsoft.NET/Framework/v2.0.50727/mscorlib.dll

----------------------------------------

css_config

    Assembly Version: 0.0.0.0

    Win32 Version: 0.0.0.0

    CodeBase: file:///C:/Scripts/cs-script/css_config.exe

----------------------------------------

System.Windows.Forms

    Assembly Version: 2.0.0.0

    Win32 Version: 2.0.50727.1433 (REDBITS.050727-1400)

    CodeBase: file:///C:/WINDOWS/assembly/GAC_MSIL/System.Windows.Forms/2.0.0.0__b77a5c561934e089/System.Windows.Forms.dll

----------------------------------------

System

    Assembly Version: 2.0.0.0

    Win32 Version: 2.0.50727.1433 (REDBITS.050727-1400)

    CodeBase: file:///C:/WINDOWS/assembly/GAC_MSIL/System/2.0.0.0__b77a5c561934e089/System.dll

----------------------------------------

System.Drawing

    Assembly Version: 2.0.0.0

    Win32 Version: 2.0.50727.1433 (REDBITS.050727-1400)

    CodeBase: file:///C:/WINDOWS/assembly/GAC_MSIL/System.Drawing/2.0.0.0__b03f5f7f11d50a3a/System.Drawing.dll

----------------------------------------

csws

    Assembly Version: 2.2.0.0

    Win32 Version: 2.2.0.0

    CodeBase: file:///C:/Scripts/cs-script/csws.EXE

----------------------------------------

System.Xml

    Assembly Version: 2.0.0.0

    Win32 Version: 2.0.50727.1433 (REDBITS.050727-1400)

    CodeBase: file:///C:/WINDOWS/assembly/GAC_MSIL/System.Xml/2.0.0.0__b77a5c561934e089/System.Xml.dll

----------------------------------------

config

    Assembly Version: 0.0.0.0

    Win32 Version: 0.0.0.0

    CodeBase: file:///C:/Documents%20and%20Settings/Administrator/Local%20Settings/Temp/1/CSSCRIPT/Cache/1175209938/config.csc

----------------------------------------

CSScriptLibrary

    Assembly Version: 2.2.0.0

    Win32 Version: 2.2.0.0

    CodeBase: file:///C:/Scripts/cs-script/lib/CSScriptLibrary.dll

----------------------------------------

System.Design

    Assembly Version: 2.0.0.0

    Win32 Version: 2.0.50727.1433 (REDBITS.050727-1400)

    CodeBase: file:///C:/WINDOWS/assembly/GAC_MSIL/System.Design/2.0.0.0__b03f5f7f11d50a3a/System.Design.dll

----------------------------------------

************** JIT Debugging **************

To enable just-in-time (JIT) debugging, the .config file for this

application or computer (machine.config) must have the

jitDebugging value set in the system.windows.forms section.

The application must also be compiled with debugging

enabled.

For example:

<configuration>

    <system.windows.forms jitDebugging="true" />

</configuration>

When JIT debugging is enabled, any unhandled exception

will be sent to the JIT debugger registered on the computer

rather than be handled by this dialog box.

The .NET libraries are installed and I can navigate to the file csc.exe without issue. I am compleatly lost as where to look on this. After googling for a long time I haven't found anyone with the same problem. Most answers refer to this with issues of using .NET 3 and this has always been used with .NET 2 on our other servers.

I have used the .NET Framework Setup Verification Utility which has told me:
Product: .NET Framework 2.0 SP1
Status: Verification Succeeded