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I've searched google and these newsgroups but not been able to find
anyone who has answered this -

Is it possible to install and run the session service on the web
server itself, enable WebGarden, then point the session state mode to
StateServer with the connection to the localhost and thus share state
among all instances of aspnet_wp that would be generated under the
WebGarden=TRUE/cpuMask=0xffffffff? My understanding from what i've
found is that the session service is separate from the aspnet_wp and
so this should work (storing info in a completely separate proc, but
located on same server), but can't see where this has been done before
and I am sure if this was an answer it would have been posted and
discussed by now.

In case you ask the idea behind this is if the process on a given CPU
restarts the session state isn't lost but you still don't incur the
same performance hit and $$ cost as putting on external SQL server,
nor suffer the single point of failure by using a single outside
"Session Server" (yes this would shortly be a web farm with individual
servers/web gardens)(and yes I understand the need to configure load
balancing to ensure the same user gets to the same server)