Thanks for responding Peter.
No, I am not making any calls to Response.Flush nor am I using any event handlers in the Global.asax.
I read elsewhere that people have been experiencing alot of problems with session loss in .Net 2.0 due to the app domain recycling constantly even though no changes where being made to the app or it's directory. However, I've built several web apps from scratch using .Net 2.0 and not had this problem, just the ones I convert from .Net 1.1. Also, it's difficult to test since I can't reliably reproduce the error.
Googling the error showed that quite a few other people have had the same problem after upgrading a working 1.1 app to 2.0 but I can't find anything on MS's site or elsewhere.
Thanks for your time,
Seth