Question

In a closed source proprietary web application, if I use an AGPL product in a sub-domain or in an iframe do I have to open-source my project?

If answer is no, is it possible that both applications can share the same database?

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Solution

IANAL, this is not legal advise. If you want to be sure, talk to a lawyer.

If you are offering a web-service that appears to be a single product, then it is likely that your users will treat it as such, regardless of how it is technically realized.

This means that if a sufficiently interested user tries to download the source of the site (to exercise his rights under the AGPL), you can expect a formal request to provide the sources for the proprietary part as well. And if you are unwilling to release them, possibly a lot of bad press and legal actions.
The scenario that you propose has not yet been extensively tested in a court of law, so even for a lawyer it will be hard to tell what your chances are.
The big question then is: Are you willing to risk it and perhaps become the case that establishes the case-law for the future?

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