There is a Microsoft hotfix for certain IIS 7 or 7.5 handlers that enables extensionless urls:
http://support.microsoft.com/kb/980368
Without the hotfix, you can set urlformat to "humanfriendly" in web config, and this will allow navigation to the admin, host & subpages, but not without url extensions. The hotfix allows DNN to use the "advanced" extensionless setting.
**Thanks to Joe at dnncreative and William at wesnetdesigns for helping me figure this one out.